Consol Energy Hopes To Develop Utica Acres in Monroe County
PITTSBURGH — Since selling five West Virginia coal mines for $3.5 billion in 2013, Consol Energy has also unloaded Virginia’s Buchanan Mine for $460 million — all in an effort to help set new Marcellus and Utica shale natural gas production marks in Monroe County.
More than one industry official speaking Wednesday at the 2016 DUG East Conference in Pittsburgh referenced Monroe County as a center of operations, as Edgemarc Energy Holdings’ “Moonraker” well near Woodsfield gives firm officials hope for the future.
During the first quarter of 2016, Consol reached a company record for natural gas production at 97.5 billion cubic feet. This is a 36-percent increase from the 71.6 billion the firm pumped at the same time last year.
“We are in position to be a dominant player in the Utica Shale for years to come,” Consol Chief Operating Officer Tim Dugan said. “Our initial area of focus has been Monroe County, Ohio.”
Dugan said Consol used substantial portions of the proceeds from selling the coal mines to become a major player in the oil and natural gas business. Information he provided indicates Consol controls 622,000 acres for Utica development.
“At Consol, we are quite proud of our work in the Utica,” he said.
Consol’s “Switz 6” pad in Monroe County produced 5.69 billion cubic feet of natural gas from January through March from its four Utica wells, with the best-performing well accounting for 1.77 billion cubic feet of the production.
The company also has the “Moundsville 6H” well in Marshall County that yielded 39 million cubic feet of natural gas during its first 24 hours. The well features a horizontal shaft nearly two miles in length underground.
Marcellus production volumes in the quarter for Consol were 51.2 billion cubic feet, while the firm pumped 22.9 billion cubic feet from the deeper Utica formation.
EdgeMarc Chief Operating Officer Callum Streeter said the Canonsburg, Pa.-based firm also operates in Washington County, Ohio. The substantial portion of the driller’s financial support comes from global financial services giant Goldman Sachs and the Ontario Teachers’ Pension Plan.
“We believe in holding back pressures on these Utica wells to realize their profitability,” Streeter said of allowing natural gas to flow from the well at a slower rate.
Mark Rothenberg, CEO of Apex Energy, discussed the impact of lower active rig counts related to natural gas production. According to oilfield services giant Baker Hughes, there are now 474 rigs running in North America. This compares to 989 at this time last year — and 2,101 two years ago.
“We feel today’s shortage of rigs is not going to be felt until mid-2017 for natural gas,” Rothenberg said of a slowdown in drilling causing commodity prices to rise.