JEWETT - A Chesapeake Energy Utica Shale well in Harrison County yielded 1.52 billion cubic feet of natural gas and 13,472 barrels of oil in 2011, according to the Ohio Department of Natural Resources.
Chesapeake's initial Utica production information shows this well operated for 198 days in 2011, meaning it produced an average of 7.69 million cubic feet of gas per day, along with 68 barrels of oil.
"We will continue to gather information and move forward with our plans to increase our rig count in Ohio to 20 rigs by the end of the year - and to build a significant gathering and midstream complex in the region to accommodate an anticipated increase in production of natural gas liquids," said Chesapeake Director of Corporate Development Keith Fuller, referring to the $900 million complex the company will build with M3.
Mike Stice, president of Chesapeake Midstream Development, a subsidiary of Chesapeake Energy, speaks about the company’s planned $900 million natural gas processing complex in eastern Ohio during the recent Marcellus Midstream Conference and Exhibition in Pittsburgh.
Chesapeake wells in East Ohio - including the Harrison well combined with four wells in Carroll County - pumped a total of 2.62 billion cubic feet of natural gas in 2011, along with more than 43,000 barrels of oil. According to ODNR records, the Harrison County well is located in the area south of Jewett on property in the name of Buell. There are also two wells in Carroll County, one in Mahoning County and one in Portage County that produced only oil, bringing the total oil results to more than 45,000 barrels in 2011.
Chesapeake announced plans earlier this year to shift much of the company's focus from drilling in the methane-dominated dry gas regions in much of Pennsylvania, to drilling in the wet gas. This is due to relatively low natural gas prices compared to the price commanded by natural gas liquids, such as ethane, propane, butane and pentane, as well as crude oil.
"The preprocessing, wellhead results from our initial drilling in the Utica Shale that were reported ... by the ODNR continue to fuel our optimism for future production from the play," said Fuller. "The data reported, while promising, is still very limited and only a small part of the information needed to gauge the potential of the entire formation."
Tom Stewart, executive vice president of the Ohio Oil and Gas Association, said the initial Utica production numbers show "there is a lot of work that needs done in the Utica Shale to see where it is going to be most productive."
"Chesapeake and the other companies are engaged in a very large and expensive research project right now," he said, noting it costs the companies roughly $10 million to drill one Utica well. "The folks at Chesapeake are brave people doing brave things."
In response to the demand for processing capacity for the liquids-rich wet Utica gas, Chesapeake is partnering with M3 to build a $900 million processing complex. The processing facility to be located in Columbiana County will have an initial capacity of 600 million cubic feet per day. Natural gas liquids will be delivered to a central hub complex in Harrison County that will feature an initial storage capacity of 870,000 barrels. The Harrison County facility will also have fractionation capacity of 90,000 barrels per day, as well as a substantial rail-loading facility, according to Chesapeake.
According to a map on the M3 website, it appears the Harrison County portion of the complex would be built near Scio. The Columbiana County part of the complex would be located near Kensington.