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Drilling permits issued

SALEM – The Ohio Department of Natural Resources reported three new horizontal drilling permits were issued in the Utica/Point Pleasant for the week ending Aug. 8.

There were two permits issued in Jefferson County, one to Chesapeake Exploration LLC in Ross Township and one to American Petroleum PRTR OH LLC in Salem Township.

Another permit was issued to XTO Energy Inc. for Poultney Township in Belmont County.

All the wells are in the “permitted” stage.

To date, there have been 1,985 horizontal permits issued, 1,568 wells drilled with 935 wells producing in the Utica/Point Pleasant play.

The number of rigs drilling in the play is at 22 compared to 20 in the last report.

There were 55 drilling rigs in the play as late as the third week of December 2014.

No rigs are drilling in the Ohio Marcellus shale, according to the ODNR where there are 44 horizontal wells permitted and 29 drilled.

As of July 4, the ODNR listed a total of 1,953 total wells drilled by 34 operators with Chesapeake Exploration holding 782 wells, followed by Gulfport Energy with 231, and American Energy Utica LLC and Antero Resources Corp each have 161 well.

Eclipse Resources I LP is the only other company in the triple digits in the play with 120 wells.

When the report was filed, the ODNR said 912 wells were producing, 526 were drilled, and 424 were permitted, not drilled or canceled. There were 26 drilled and inactive or shut in wells, 25 lost hole or final restoration wells, and three dry and abandoned.

During a second quarter earnings call on Aug. 6, transcribed on the Seeking Alpha website, Daniel J. Rice, IV, CEO and director for Rice Energy with holdings in the Utica shale play said the company, “had a great second quarter bringing wells online ahead of schedule and under budget.

“As we are economically growing our business, we remain focused on maximizing returns and protecting against the downside risks.

“The second quarter was no exception as we continued to prove our technical proficiency in the Marcellus and Utica while meaningfully reducing our development costs without sacrificing our resource.

“And we managed to prudently protect our producing cash flows in the second quarter with our hedging and firm transportation portfolio which significantly lessened our exposure to anticipated seasonally weaker Appalachian pricing.”

He said the company is the only one exclusively operating in both the cores of the Marcellus and Utica shales.

Rice said, “A Utica highlight for the second quarter was our Mohawk Warrior pad (Belmont County), a trio of 12,000-foot laterals, which are the longest laterals we’ve ever drilled. We turned these wells to sales in June about a month ahead of schedule at an average development cost of $1,400 per lateral foot. These wells have stabilized at an average rate per well of approximately 20 million cubic feet per day.

“Our first Utica well, the Bigfoot 9H (Belmont County), has been online for over 400 days and to-date has cumulatively produced over 6 Bcf. This well is currently producing 16 million cubic feet per day, and we expect it to produce at this flat rate for a total of 450 days, in line with our forecast.”

lshields@salemnews.net

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