Report Finds Utica Shale Productivity Increased Rapidly

Ohio's Utica Shale region contributed significantly to the country's overall natural gas production growth over the past three years, according to a report issued Tuesday.  Combined with production in the Marcellus shale region, which includes West Virginia and parts of Pennsylvania and New York, the two shale plays were responsible for 85% of the growth in U.S. shale gas production since 2012, the U.S. Energy Information Administration's said.  "The productivity of natural gas wells in the Marcellus Shale and the neighboring Utica Shale is steadily increasing because of ongoing improvements in precision and efficiency of horizontal drilling and hydraulic fracturing occurring in those regions," the EIA analysis said.

While the Marcellus region accounted for most of the increased natural gas production, growth in the newer Utica play outpaced all the other major shale regions that the EIA tracked in recent years.  In October 2013, natural gas production in the Utica totaled 2.4 million cubic feet per day, a figure that grew to nearly 7 million MMcf/d in June of this year, according to EIA.  Total natural gas production in the Utica increased rapidly, although it has leveled off somewhat in recent months. Production in July 2015 was almost 18 times higher than in January 2013.  The rate of productivity in the Utica region went from 0.31 MMcf/d per drilling rig in January 2012 to 6.9 MMcf/d per rig by July 2015, the federal agency said.  EIA attributed the increases in natural gas production from the Utica and Marcellus to several factors, including:  Greater use of advanced drilling techniques; Increased number of stages used in hydraulic fracturing operations;  New techniques like "zipper fracturing," or simultaneous fracturing of individual stages of two parallel horizontal wells; and, Use of specific components during well completion that aid in increasing fracture size and porosity of the geologic formation being targeted.

While the drop in oil and gas prices that started last year has slowed down fracking around the country, the Utica play is the only one of the country's seven major shale regions that the EIA monitors where natural gas production is projected to increase next month.  Natural gas production in the Utica is expected to increase by 22 MMcf/d in August, according to EIA's July Drilling Productivity Report. Meanwhile, production is expected to drop 41 MMcf/d in the Marcellus and by as much as 122 MMcf/d in Texas's Eagle Ford region.  Despite the increase, the number of drilling rigs operating in the Utica has dropped from a high of more than 30 last year to about a dozen, the report says. The same trend is seen in other shale plays, like the Bakken in North Dakota, which went from nearly 200 rigs to about 75 in the last year.

Meanwhile, the Ohio Energy Resource Alliance reported that the state has issued a total of 1,980 permits for drilling in the Utica Shale since December 2009 based on data from the Department of Natural Resources.  A total of 1,543 Utica wells have been drilled since December 2009, an increase of eight since ODNR's previous update on July 18, 2015, the industry group said. In addition, 926 wells are in production.  Carroll County has the most Utica Shale permits at 495. Harrison County has 365 permits and Belmont County has 239.