Chesapeake Energy announced a major new natural gas liquids play in the Utica Shale of eastern Ohio based upon results from six horizontal and nine vertical wells. The company holds 1.25 million net leasehold acres in the Utica Shale and believes that they could be worth $15 – $20 billion in increased value to the company.More at Chesapeake Energy.
West Virginia Gas
The State of West Virginia is holding public hearings to receive input on how to better regulate development of the state’s Marcellus Shale resource.More at Business Week.
In 2008 and earlier lots of landowners above the Marcellus Shale signed natural gas lease agreements for the historical “going rate” of a few dollars per acre. Then as the potential of the rock unit became known the signing bonuses paid on leases skyrocketed to thousands of dollars per acre. Now these leases are expiring and legal battles between landowners and gas companies are beginning.More at Business Week.
Major oil companies are rapidly buying the small players in the Marcellus Shale gas play. Exxon Mobil Corporation just spent $1.7 billion to purchase Phillips Resources, Inc. and TWP Inc. This follows Chevron’s recent acquisition of Atlas Energy and other transactions. More on the FuelFix.com blog.
Randy Huffman, Secretary of the West Virginia Department of Environmental Protection does not support a Marcellus Shale drilling moratorium for the state because… “If I ever felt the industry was so far out in front of our ability to properly regulate it, then I would consider such a thing.” More in The Register-Herald.com.
The Utica Shale has a larger geographic extent than both the Marcellus Shale of the Appalachian Basin and the Barnett Shale of Texas. It is also has a much larger total volume. Will its gas producing potential exceed that of the Marcellus and Barnett. An article on the Seeking Alpha blog explores this question.
John Pinkerton, CEO of Range Resources, explains the “Triple Play” in natural gas that can be had in parts of Pennsylvania, New York, Ohio and West Virginia. Shale gas can be produced from the Upper Devonian Shale, the Marcellus Shale, and the Utica Shale – all from a single drill pad. More in the Star-Telegram Blogs.
From the PAGasDirectory Blog…. In an assessment of its lease holdings, Range Resources has included 10 to 14 trillion cubic feet of Upper Devonian natural gas as an unproven resource. The Upper Devonian is above the Marcellus Shale and includes multiple organic shales such as the Cleveland, Huron-Dunkirk, Rhinestreet, Middlesex and Geneseo-Burket Shales. See an article on SearchAndDiscovery.net for a generalized stratigraphic sequence.
While many lawmakers in Pennsylvania are trying to get a severance tax passed, their counterparts in West Virgina are investigating tax breaks to jump-start Marcellus Shale development. More in the Boston Globe.
Chevron continues the stream of large diversified oil and gas companies who are buying up smaller companies with a heavy focus on natural gas shales. Atlas had lots of assets in the Marcellus Shale in Pennsylvania and West Virginia. Many of those leases probably give access to the deeper Utica Shale which is attracting more interest. More at Bloomberg.
A study on the economic, legal, regulatory, and environmental issues related to development of the Marcellus Shale has been published by the West Virginia University College of Business and Economics, Bureau of Business and Economic Research.
Don’t know the vertical sequence of rocks in the Marcellus Shale gas play? The West Virginia Geological and Economic Survey has published a stratigraphic nomenclature chart for the Marcellus Shale and associated rocks in West Virginia.
West Virginia has a wealth of energy resources. It has historically been a leading state for coal production and now much of northern West Virginia is over the Marcellus Shale natural gas field. An article in the Beckley Register-Herald titled “Will Natural Gas Replace Coal” explores how these two fuels might compete in the marketplace and how that competition might impact the West Virginia economy.
A rock layer below the Marcellus Shale could prove to be another incredible source of natural gas. The Utica Shale is thicker, more geographically extensive and has already proven its ability to support commercial production.