Completion of new pipelines and processing plants has allowed production of gas and oil from the Ohio Utica shale formation to soar in the last year.
Annual numbers show that natural gas production increased 680 percent from 2012 to 2013, and oil production grew by 470 percent, according to a report released by the state on Wednesday.
The one-year increase in natural gas production is the biggest in Ohio history and the most natural gas that Ohio has produced since 1982, state officials said.
To put the volume into perspective, Ohio homes consume 270 billion cubic feet of natural gas in a typical year. The new Utica shale horizontal wells, which for all practical purposes were nonexistent just four years ago, produced 100.1 billion cubic feet of gas in 2013 — more than a third of Ohio’s home needs.
And in the first quarter of this year alone, the state has produced about 67 billion cubic feet from Utica wells — more than half of all of last year’s output.
“History is being made as we speak,” said Ohio Department of Natural Resources Director James Zehringer at Stark State College.
The Utica shale is “the real deal,” Zehringer said at the conclusion of a 90-minute presentation looking at production totals and what Ohio is doing to protect residents from drilling problems.
The data “looks good,” said geology professor Jeffrey Dick from Youngstown State University and an expert on the Utica shale. “But it’s still early. … We’re only in the second inning.”
The Utica numbers for 2013 look like this in comparison with 2012:
• Gas production — 100.1 billion cubic feet vs. 12.8 billion cubic feet.
• Oil production — 3.7 million barrels vs. 636,000 barrels.
• Operating wells — 352 vs. 85.
By the end of the first quarter of this year, the state had added another 56 wells.
And meanwhile, officials said, there is no evidence that production from the earliest wells has begun to taper, which is expected at some point.
There are two types of production wells in Ohio: Straight wells, which are old technology and have been in existence for decades, and the new wells that go down vertically then turn horizontal. The drilling process also includes the injection of liquids and sand under high pressure to fracture the shale and release more gas, oil and other lucrative products.
The 352 horizontal wells are so productive that they are overtaking the volume generated by the 51,000 vertical-only wells. Of total production, Utica in 2013 accounted for 58 percent of Ohio’s gas and 45 percent of the oil.
“The significant jump in oil and natural gas production in 2013 continues to show the great promise of the Utica shale,” said Shawn Bennett of Energy in Depth — Ohio, a pro-drilling trade group. “In addition, last year recorded the largest single-year increase in natural gas production in Ohio’s history signifying midstream capacity is catching up with development. As we look to next year, production is only going to continue to increase dramatically as we continue to develop this important resource.”
Zehringer said that the big growth numbers are driven by both increased drilling and the completion of pipelines and processing plants in eastern Ohio.
Although there were some infrastructure bottlenecks in the fourth quarter of last year causing production data to flatten, that’s over, he said.
There has been a renewed surge in 2014.
In addition to the 67 billion cubic feet of natural gas in the first three months from 418 wells, oil output was 1.9 million barrels compared with 3.7 million for all of 2013.
There will be no slowdown.
Ohio’s first shale wells were drilled in late 2010. The state projects another 700 Utica wells will be drilled in 2014 — about double the number in operation last year — and another 800 in 2015, said Rick Simmers, chief of ODNR’s Division of Oil and Gas Resources Management.
To date, Ohio has approved 1,386 Utica shale permits. Of that total, 926 wells have been drilled with 470 wells in production or capable of beginning production. A total of 41 drilling rigs are working in Ohio for 31 drilling companies involved in the Utica shale.
Meanwhile, Simmers said, Ohio is working with other states and agencies in the study of earthquakes triggered by both hydraulic fracturing and injection wells, which are used for high-pressure underground disposal of drilling waste.
Other numbers released Wednesday include total production from straight and horizontal wells:
• Total gas up 97 percent to 171.6 billion cubic feet.
• Total oil up 62 percent to 8.1 million barrels.
The Utica output is having a big impact on the Ohio economy, said David Mustine, JobsOhio senior managing director.
Billions of dollars have been invested in pipelines and processing facilities, and 40 Ohio companies manufacture items used by the industry, he said.
And Ohioans have benefited from cheaper natural gas prices, he said.
The complete report can be found on the web at http://oilandgas.ohiodnr.gov/oil-gas-home/post/state-of-the-play.
Bob Downing can be reached at 330-996-3745 or email@example.com.