New Utica Drilling Permits Increase in 2022
YOUNGSTOWN, Ohio – The number of new drilling permits issued to oil and gas companies exploring the Utica/Point Pleasant shale formation in Columbiana County increased substantially in 2022 compared with the previous two years, records show.
The Ohio Department of Natural Resources reports that oil and gas companies secured a total of 40 permits to drill new horizontal wells across the county as of Dec. 27, a 60% increase from the same period in 2021 and a 233% increase compared with 2020.
In 2021, 25 new permits were issued, according to ODNR. In 2020, ODNR awarded just 12 permits as the COVID-19 pandemic placed a stranglehold on energy exploration and drove oil and gas prices downward.
That trend reversed itself in 2022, as oil and natural gas prices skyrocketed.
New drilling activity across the northern Utica in Columbiana is limited to two companies – Hilcorp Energy Co. and EAP Ohio LLC, a division of Encino Energy. Both are based in Houston, but EAP maintains an Ohio office in Louisville.
According to ODNR, Hilcorp received 37 permits for new wells in Columbiana County this year as of Dec. 27. The company also secured seven permits to deepen existing wells. EAP was awarded three permits for new wells and four permits to deepen its existing wells.
The majority of new permits issued to Hilcorp during 2022 pertain to well pads in Elk Run Township, while EAP has focused on its holdings in Hanover Township, according to records.
EAP operates 93 wells across Columbiana County, ODNR records show. It’s most productive well is the company’s Sevek 201H well in Washington Township, according to the latest production data. That well produced 1.240 billion cubic feet of gas over a 79-day period during the third quarter of 2022.
Hilcorp reports it operates 38 wells in Columbiana County, according to ODNR. Hilcorp’s Tarka 6H well in Fairfield Township proved the company’s most productive well during the third quarter, yielding 705.89 million cubic feet of gas over a 92-day period.
ODNR reported there were no permits awarded to energy companies in 2022 for new wells in Mahoning or Trumbull counties, areas where oil and gas production is negligible.
Much of the production across eastern Ohio’s Utica/Point Pleasant shale formation is concentrated in counties further south. Ascent Resources’ Kelpie 2H well in Jefferson County, for example, was the most productive well in the state during the third quarter, pumping out 4.4 billion cubic feet of gas during the period.
The state’s largest oil producing well was EAP’s Bauer well in Carroll County, which yielded 116,305 barrels of oil during the third quarter, ODNR records show.
During the third quarter, Ohio’s 3,096 active horizontal wells produced a total of 4.9 million barrels of oil and 546.6 billion cubic feet of natural gas over an average of 85 days, ODNR reported.
Meanwhile, oil and natural gas production among the country’s top shale plays continues to increase, according to the most recent data from the U.S. Energy Information Administration.
In Appalachia, which combines the Marcellus shale formation in Pennsylvania and West Virginia with the Utica/Point Pleasant in Ohio, oil production is expected to hit 191,000 barrels per day next month, an increase of 3,000 barrels per day compared with December.
EIA also estimates that Appalachian shale formations will produce 35.5 million cubic feet of natural gas per day in January, a boost of 113 million cubic feet per day from December.
The country’s six other shale plays – the Anadarko in Oklahoma, the Bakken in Montana and North Dakota, the Haynesville in Texas and Louisiana, the Niobrara in Wyoming and the Eagle Ford and Permian Basin in Texas – are all expected to increase natural gas production in January.
Five of the six plays are expected to increase oil production as well, the EIA estimates, while output from the Haynesville shale is projected to be flat next month compared with December.
Copyright 2023 The Business Journal, Youngstown, Ohio.