The Debrosse Memorial Report 2017 Oil & Gas Activity in Ohio

Transcription

1 The Debrosse Memorial Report 2017 Oil & Gas Activity in Ohio 71 st Annual Winter Meeting Prepared by: Marty Shumway Locus Bio-Energy Solutions LLC; Shumway Resources LLC Bill Arnholt - Northwood Energy Corporation Tim Knobloch - James Knobloch Petroleum Consultants, Inc.

2 The Debrosse Memorial Report 2017 Oil & Gas Activity in Ohio - Outline General overview of Ohio oil & gas production Permits & completion summaries Operator activity (footage drilled, number of wells) Activity by county (footage drilled, number of wells) IP analysis for horizontal wells Change of owners Production summary Utica EUR summary Class II injection well summary

3 Oil & Gas Production in Ohio More than 275,000 oil and gas wells drilled in Ohio since 1860 More than 50,000 producing wells in 49 of 88 Ohio counties

4 History of Ohio Wells Drilled by Year and Reservoir BEREA OHIO SHALE CLINTON TRENTON ROSE RUN CAMBRIAN NW Ohio Lima-Indiana Clinton Play Tight Gas Sands Morrow County Trempealeau Play Clinton Play Technologic Advance: Hydraulic Fracturing Clinton/Berea Plays 0

5 2017 Permit & Completion Activity PHOTOGRAPHS COURTESY OF LARRY WICKSTROM

6 Permits & Completions TYPE ( 16 to 17) % PERMIT 903 1,608 1, % COMPLETION % PLUG % TOTAL 1,929 2,818 2,942 2,318 1, %

7 2017 Completions Outcomes WELL STATUS COUNT % OF TOTAL PRODUCING % NOT DRILLED % FINAL RESTORATION % WELL DRILLED 9 2.0% PLUGGED BACK 9 2.0% PLUGGED & ABANDONED 3 0.7% LOST HOLE 2 0.4% UNKNOWN 2 0.4% CANCELLED 1 0.2% STORAGE WELL 1 0.2% TOTAL

8 Permitted Formations

9 2017 Completions Permits to Drill Permits to Plug

10 Permit and Completions By Month Permits Completions Plugging Permits JAN FEB MAR APRIL MAY JUNE JULY AUG SEP OCT NOV DEC DOES NOT INCLUDE COMPLETIONS WITH NOT DRILLED OR CANCELLED STATUS.

11 Operators Completing Wells By Year DOES NOT INCLUDE COMPLETIONS WITH NOT DRILLED OR CANCELLED STATUS.

12 2017 Wells Completed Type 377 Total Completions Vertical 57, 15% Unknown 2, 1% Directional 2, 0% Horizontal 317, 84% DOES NOT INCLUDE COMPLETIONS WITH NOT DRILLED OR CANCELLED STATUS.

13 2017 Horizontal Completions By Formation

14 2017 Vertical Completions By Formation

15 2017 Class II Injection Well Completions By TD Formation

16 2017 Completions By Month Horizontal Vertical JAN FEB MAR APRIL MAY JUNE JULY AUG SEP OCT NOV DEC VERTICAL COUNT INCLUDES DIRECTIONAL AND UNKNOWN DOES NOT INCLUDE COMPLETIONS WITH NOT DRILLED OR CANCELLED STATUS.

17 2017 Completions Top 10 Counties COUNTY TOTAL % TOT HORIZONTAL VERTICAL BELMONT % MONROE 48 13% 46 2 JEFFERSON 43 11% 39 4 HARRISON 38 10% 33 5 GUERNSEY 26 7% 22 4 NOBLE 25 7% 24 1 CARROLL 23 6% 22 1 LICKING 9 2% 0 9 COSHOCTON 7 2% 0 7 COLUMBIANA 6 2% 6 0 OTHER 28 7% 4 24 TOTAL % VERTICAL COUNT INCLUDES DIRECTIONAL AND UNKNOWN. DOES NOT INCLUDE COMPLETIONS WITH NOT DRILLED OR CANCELLED STATUS. TOP 3 COUNTIES INCLUDE 57% OF COMPLETIONS.

18 VERTICAL COUNT INCLUDES DIRECTIONAL AND UNKNOWN. DOES NOT INCLUDE COMPLETIONS WITH NOT DRILLED OR CANCELLED STATUS. TOP 3 COUNTIES INCLUDE 57% OF COMPLETIONS Completions By County HORIZONTAL VERTICAL

19 Hess Ohio CNXGUE10N7W #H-8 PHOTOGRAPH COURTESY OF LARRY WICKSTROM

20 Top 12 Most Active Operators By Wells OPERATOR % TOT WELLS 2017 WELLS % 2016 ASCENT RESOURCES UTICA LLC 21% 79 20% CHESAPEAKE EXPLORATION LLC 15% 58-41% GULFPORT ENERGY CORPORATION 12% 47-24% RICE DRILLING D LLC 11% % ECLIPSE RESOURCES I LP 7% 26-43% ANTERO RESOURCES CORPORATION 6% 22-66% STATOIL USA ONSHORE PROP INC 3% 11 22% CNX GAS COMPANY LLC 3% 11-62% ARTEX OIL COMPANY 2% 9 29% XTO ENERGY INC. 2% 9-63% EM ENERGY OHIO LLC 1% 5 N/A HILCORP ENERGY COMPANY 1% 4-43% DOES NOT INCLUDE COMPLETIONS WITH NOT DRILLED OR CANCELLED STATUS. TOP 12 OPERATORS COMPLETED 87% OF TOTAL.

21 Top 12 Most Active Operators By Footage OPERATOR % TOTAL FOOTAGE 2017 FOOTAGE % 2016 ASCENT RESOURCES UTICA LLC 23% 1,413,539 41% CHESAPEAKE EXPLORATION LLC 16% 990,645-38% GULFPORT ENERGY CORPORATION 14% 857,085-20% RICE DRILLING D LLC 13% 774, % ECLIPSE RESOURCES I LP 8% 493,524-32% ANTERO RESOURCES CORPORATION 7% 393,460-64% CNX GAS COMPANY LLC 4% 224,980-46% STATOIL USA ONSHORE PROP INC 4% 221,831 96% XTO ENERGY INC. 3% 186,495-59% EM ENERGY OHIO LLC 1% 86,414 N/A R E GAS DEVELOPMENT LLC 1% 61,990-54% HILCORP ENERGY COMPANY 1% 60,950-43% TOTALS 96% 5,765,610-21% DOES NOT INCLUDE COMPLETIONS WITH NOT DRILLED OR CANCELLED STATUS. TOP 12 OPERATORS COMPLETED 96% OF TOTAL.

22 Top 12 Most Active Counties By Wells COUNTY % TOT WELLS 2017 WELLS % 2016 BELMONT 33% 124 3% MONROE 13% 48-45% JEFFERSON 11% 43 79% HARRISON 10% 38-63% GUERNSEY 7% 26-42% NOBLE 7% 25-55% CARROLL 6% 23-51% LICKING 2% 9-31% COSHOCTON 2% 7 0% COLUMBIANA 2% 6-25% KNOX 1% 5-67% WAYNE 1% 2 100% OPERATORS REPORTED COMPLETIONS IN 25 OF 88 COUNTIES IN 2017 VERSUS 36 IN TOP 12 COUNTIES 94% TOTAL WELLS

23 Top 12 Most Active Counties By Footage COUNTY % TOT FOOTAGE 2017 FOOTAGE % 2016 BELMONT 38% 2,314,231 19% MONROE 16% 936,662-27% JEFFERSON 13% 788, % HARRISON 9% 544,914-65% NOBLE 7% 437,283-49% GUERNSEY 7% 405,150-37% CARROLL 6% 365,317-48% COLUMBIANA 2% 96,494-18% LICKING 0.5% 30,697-27% COSHOCTON 0.3% 17,493-35% KNOX 0.2% 14,847-45% ASHLAND 0.2% 10,915 90% TOP 12 COUNTIES ACCOUNTED FOR 99% OF TOTAL FOOTAGE DRILLED IN 2017.

24 Drilling Footage and Wells By Year YEAR TOTAL FOOTAGE WELLS FOOTAGE PER WELL AVG IP GAS AVG IP OIL ,033, ,263 9, ,955, ,206 6, ,587, ,336 5, ,854, ,398 2, ,898, ,570 1, ,580, , ,832, , ,224, , ,036, , ,249, , ,030, , ,601, , ,718, , ,324, , ,419, , TO 2017 AVG IP-GAS UP 52%; AVG IP-OIL UP 27% 2016 TO 2017 AVG FOOTAGE PER WELL UP 14%

25 Change of Owner Wells By Year M&R INVESTMENTS, THREE LARGE TRANSFERS 1585 WELLS FROM ENERVEST; 1371 WELLS FROM ATLAS NOBLE; 649 WELLS FROM VIKING RESOURCES.

26 Top 12 Counties By Average IP (MCFE) COUNTY WELLS AVG IP OIL (BBLS) AVG IP GAS (MCF) AVG IP (MCFE) GUERNSEY ,411 18,269 HARRISON ,364 16,501 CARROLL ,535 13,715 MONROE ,696 13,696 JEFFERSON ,511 13,519 BELMONT ,244 13,252 NOBLE ,450 10,755 COLUMBIANA 6 0 5,324 5,324 LICKING KNOX COSHOCTON COUNTIES WITH LESS THAN 4 WELLS ARE NOT INCLUDED MCFE CALCULATED USING OIL GAS EQUIVALENCE OF 22:1

27 Top 12 Operators By Average IP (MCFE) OPERATOR WELLS AVG IP OIL (BBLS) AVG IP GAS (MCF) AVG IP (MCFE) ASCENT RESOURCES UTICA LLC ,584 20,815 CNX GAS COMPANY LLC ,660 15,660 STATOIL USA ONSHORE PROP INC ,965 14,965 GULFPORT ENERGY CORPORATION ,438 13,455 ECLIPSE RESOURCES I LP ,353 13,369 CHESAPEAKE EXPLORATION LLC ,616 13,179 R E GAS DEVELOPMENT LLC ,787 10,728 ANTERO RESOURCES CORPORATION ,985 10,590 XTO ENERGY INC ,920 8,920 RICE DRILLING D LLC ,523 4,523 HILCORP ENERGY COMPANY 4 0 3,501 3,501 ARTEX OIL COMPANY OPERATORS WITH LESS THAN 4 WELLS ARE NOT INCLUDED. MCFE CALCULATED USING OIL GAS RATIO OF 22:1

28 Average IP (MCFE) Top 12 Operators By Average IP (MCFE) Thousands OPERATORS WITH LESS THAN 4 WELLS ARE NOT INCLUDED. MCFE CALCULATED USING OIL GAS RATIO OF 20:1

29 2017 Top 10 Operators By Average IP (MCFE) Well Locations

30 PHOTOGRAPH COURTESY OF LARRY WICKSTROM Ohio Oil & Gas Production

31 COUNT OF WELLS Producing Wells By Year PR Status (ODNR) Wells Reporting Production YEAR YEAR 2017 WELL COUNT IS ESTIMATED

32 Million Barrels of Oil Production Summary Oil By Year 30 Conventional Oil Horizontal Oil OIL PRODUCTION IS ESTIMATED TO BE APPROXIMATELY 6% LESS THAN 2016 PRODUCTION CONVENTIONAL OIL PRODUCTION ESTIMATED 2017 HORIZONTAL OIL ESTIMATED (ONLY FIRST 3 QUARTERS AVAILABLE) 5 0 YEAR 2017 CONVENTIONAL PRODUCTION IS ESTIMATED BY USING AVERAGE ANNUAL PERCENT DECLINE FOR YEAR

33 Billion Cubic Feet of Gas 954 1,389 1,717 Production Summary Gas By Year Conventional Gas Horizontal Gas GAS PRODUCTION IS ESTIMATED TO BE APPROXIMATELY 23% MORE THAN 2016 PRODUCTION 2017 CONVENTIONAL GAS PRODUCTION ESTIMATED 2017 HORIZONTAL GAS ESTIMATED (ONLY FIRST 3 QUARTERS AVAILABLE) YEAR 2017 CONVENTIONAL PRODUCTION IS ESTIMATED BY USING AVERAGE ANNUAL PERCENT DECLINE YEAR

34 MILLIONS OF BARRELS OF OIL Ohio Oil Production MMBLS TRENTON MMBLS TREMPEALEAU MMBLS CLINTON MMBLS UTICA MMBLS UTICA MMBLS EOR 1952 HYDRAULIC FRACTURING MMBLS YEAR HISTORICAL DATA COURTESY OF WICKSTROM GEOSCIENCE, LLC

35 OIL (BBLS) / GAS (MCF) COUNT OF WELL Ohio s Aging Wells Average Annual Oil Average Annual Gas Count of Wells % OF ~53,000 PRODUCING WELLS ARE BETWEEN 26 & 40 YEARS OLD WELL AGE - YEARS

36 UTICA PRODUCING WELLS BY OPERATOR (More than 10 Wells) Through 12/31/2017

37 Gas in BCF Utica Gas Production By Quarter % PRODUCTION GROWTH 1 st QTR 2017 THROUGH 3 rd QTR st nd rd th st nd rd th st 2015 Series nd rd th st nd rd th st nd rd 2017

38 Oil in Millions of Bbls Utica Oil Production By Quarter st nd rd th st nd rd th st 2015 Series nd rd th st nd rd th st % PRODUCTION GROWTH 4 th QTR 2016 THROUGH 3 rd QTR nd rd 2017

39 Wells Online Utica Wells Online By Quarter st nd rd th st nd rd th st 2015 Series nd rd th st nd rd th st nd % INCREASE IN WELLS ONLINE 4 th QTR 2016 THROUGH 3 rd QTR rd 2017

40 Utica EUR Estimation Used operator reported production to ODNR through 3 rd 2017 Calculated Estimated Ultimate Recovery (EUR) values for each well Adjusted EUR to gas equivalents (BCFE) used GAS/OIL ratio of 22:1 (based on current market prices) Determined treated length (stimulated interval) and then calculated EUR per 1000 of lateral EUR Data Provided by James Knobloch Petroleum Consultants, Inc.

41 UTICA AVERAGE EUR PER 1000 LATERAL BY TOWNSHIP USING GAS:OIL RATIO OF 22:1 (Count of data points per township posted) EUR Data Provided by James Knobloch Petroleum Consultants, Inc.

42 PHOTOGRAPH COURTESY OF LARRY WICKSTROM Class II Injection Wells

43 Water Volume Injected (Bbls) Annual Injection Volume - Statewide % -8% 22% 25 29% 20 16% 15 14% Series2 12,689,735 14,675,408 17,474,821 25,277,646 31,681,718 29,359,014 35,814,517

44 Top 12 Class II Injection Wells By Volume OPERATOR COUNTY WELL THE TOP 12 WELLS ACCOUNTED FOR 48% OF TOTAL WATER INJECTED IN 2017 VOLUME (BBLS) K & H PARTNERS LLC ATHENS K & H PARTNERS LLC (SWIW #10) 2,474,972 REDBIRD DEVELOPMENT WASHINGTON RED BIRD (SWIW #18) 1,942,606 ELKHEAD GAS & OIL TUSCARAWAS MOZENA (SWIW #13) 1,702,971 ENVIRONMENTAL ENERGY SOL. MUSKINGUM PATTISON TRUST (SWIW #30) 1,638,307 BUCKEYE BRINE LLC COSHOCTON ADAMS (SWIW #11) 1,402,324 BUCKEYE BRINE LLC COSHOCTON ADAMS (SWIW #10) 1,337,282 HEINRICH ENTERPRISES WASHINGTON HEINRICH UNIT 1,221,333 NORTH LIMA DISPOSAL MAHONING NORTHSTAR LUCKY (SWIW #12) 1,183,467 CHESAPEAKE ENERGY TUSCARAWAS CHK TUS SWD (SWIW #14) 1,182,813 HEINRICH ENTERPRISES WASHINGTON HEINRICH UNIT 1,140,916 K & H PARTNERS LLC ATHENS K & H PARTNERS LLC (SWIW #8) 1,071,727 CLEARWATER FIVE LLC GUERNSEY SHIELDS ONE (SWIW #17) 1,043,542

45 THANK YOU! Marty Shumway (614) Special Thanks To: Ohio Oil and Gas Association Bill Arnholt, Northwood Energy Tim Knobloch, James Knobloch Petroleum Consultants, Inc. Larry Wickstrom, Wickstrom Geoscience, LLC