Finally, Some Good News

The Utica Shale Play

Utica Shall, Fort Pain NY

With regard to oil and natural gas exploration, shale was once considered the wretched rock formation that was drilled through to get to good oil or natural gas reservoir rock formations such as sandstone, limestone or dolomite. However within the past 20 years or so, shale rock has come to the forefront as a major oil and natural gas producing formation, due to two major factors; a production stimulation practice known as "hydraulic fracturing" and a new method of drilling called "horizontal drilling". With the combination of these two oil and natural gas recovery methods, coupled with the land mark prices yielded by each product, a new shale play can be a valuable find. The definition of "play" as used in this context simply refers to areas oil and natural gas producers are targeting exploration activity.

So, here’s the good news: the Chesapeake Energy company, which is the 2^nd largest producer of natural gas in the United States, with world headquarters located near the northwest side of Oklahoma City, Oklahoma, recently announced that it has production reports from newly drilled test wells that are combined with thousands of older well logs; this information includes hundreds of feet of core samples that point to one of the richest find of oil ever made on American soil.  This remarkable shale play is not located in remote Alaska or some other hostile environment, but instead is can most easily be accessed in the eastern 1/3 of Ohio where it lies about 4,000 feet below the surface.

In other areas where the play is currently known to exist such as Pennsylvania, New York, West Virginia, Virginia and extreme south eastern Kentucky it is located some where between 8 and 12 thousand feet below the surface.  Even with today’s high prices, that’s too deep to be economically recovered.

As a true capitalist would expect, information regarding or disclosing initial production figures is not available for public viewing, since the heated pursuit for available land leases is still ongoing.

Regardless, major Ohio refineries are currently gearing up to receive thousands of barrels of crude oil and millions of cubic feet of natural gas per day. Concretive estimates have placed the eastern Ohio reserve to contain more than 8 billion barrels of oil alone.

Terry Fleming, of the Ohio Petroleum Council stated that the Utica shale is found beneath 72 of Ohio’s 88 counties, but the most intensive exploration programs are planned for the Eastern side of Ohio, where a “sweet spot” containing large amounts of oil and natural gas liquids have been determined to exist.

By a vast majority, the typical shale play produces mostly natural gas.   But some, such as the Eagle Ford shale which is located in south Texas, where a single well is capable of producing as much as 1,500 barrels per day, has been compared to the projected output anticipated for the Utica Shale Play.

Although the United States comes in as the 3^rd largest crude oil producer at 5.4 million barrels daily, Americans consistently consume 18.8 million barrels per day; 22% of the worlds supply, so “good” news may be a bit of an understatement.

Sources …

http://www.theinfomine.com/2011/08/27/utica-shale-a-major-oil-discovery/                   http://www.shaleplay.com/                                                     http://tgsfree4allinfo.blogspot.com/2011/07/opec.html                    http://en.wikipedia.org/wiki/Chesapeake_Energy                                        http://en.wikipedia.org/wiki/Utica_Shale