Ohio oil, gas production from shale shifts south

Dan Gearino, The Columbus Dispatch

September 10, 2014

The center of Ohio shale development is shifting somewhat to the south, based on new oil and gas production figures that show strong results for Noble County and Antero Resources Corp.

Antero has eight of the top 10 producing oil wells, and all eight are in Noble County, according to an Ohio Department of Natural Resources report on second-quarter results.

Monroe County has the top two natural-gas wells; both are owned by Hall Drilling.

Previous development of Ohio shale was clustered in or near Carroll County. Because of this head start, that county still has the most oil and gas wells and the largest production, but it lags in new development and in production per well.

"This dovetails with what I've been hearing and seeing, which is that the trend is moving south," said Matt Warnock, a lawyer specializing in energy issues at Bricker & Eckler in Columbus.

Throughout Ohio, energy companies extracted 2.5 million barrels of oil and 88.7 billion cubic feet of natural gas in the second quarter, up 26 percent and 31 percent, respectively, from revised figures for the first quarter. The totals include oil and gas from Ohio's share of the Utica and Marcellus shale formations.

Twenty-four companies reported producing oil or gas, one more than in the previous quarter.

"You can definitely tell it's amping up," said Jill McCartney, executive director of the Noble County Chamber of Commerce.

Her county is seeing an increase in drilling activity, construction of pipelines and new businesses that serve oil and gas workers. The county seat, Caldwell, got its second hotel this year, and two other hotels have been announced, she said.

Chesapeake Energy remains the state's most prolific producer. The Oklahoma-based company has 321 wells in the report, which is more than all other companies combined. It also produced the most oil and gas: 1.1 million barrels of oil and 44.2 billion cubic feet of gas. Much of Chesapeake's output is in Carroll County.

Meanwhile, Antero is doing a lot with a much smaller presence. The Colorado-based company had 31 wells producing 587,013 barrels of oil and 11 billion cubic feet of gas. Most of Antero's output is in Noble County.

Another leading producer is Gulfport Energy of Oklahoma, which had 60 wells, 321,143 barrels of oil and 15.1 billion cubic feet of gas. It is getting its best results in Harrison County.

Although production is rising, Ohio remains a tiny part of the national energy picture. The Energy Information Administration predicts that Ohio shale will have an average daily output of 40,000 barrels of oil and 1.39 billion cubic feet of gas this month. That is the lowest, or close to the lowest, of the seven shale regions the agency monitors.

For comparison, the country's most-prolific shale-oil region - the Permian Basin in Texas and New Mexico - has output 40 times greater than Ohio's. The most prolific shale-gas region - the part of the Marcellus centered in Pennsylvania and West Virginia - has output nearly 400 times greater than Ohio's.

Close observers of Ohio's energy businesses say the state is still early in its development. They also say that production is constrained while producers wait for construction of pipelines and other infrastructure.

"You have to be a little bit patient and see what's going to happen," Warnock said. "There are still a lot of wells to be drilled."