Oil Production On The Rise In Ohio
Oil production increased by 1.43% in Ohio in 2011 based on the forty-seventh edition of the Ohio Oil & Gas Summary (The McCormac Report) by the Ohio Department of Natural Resources (ODNR). The McCormac Report, named after Mike McCormac, ODNR’s oil and gas permitting manager, found that Ohio produced 73.3 billion cubic feet of natural gas and 4.9 million barrels of oil in 2011. The combined market value of crude oil and natural gas production in Ohio was $747,714,808 bringing significant revenue to the state.
In 2011, Ohio operators developed 460 oil and gas wells in 42 of Ohio’s 88 counties. Knox and Stark Counties were the most active counties, although we will see this trend change significantly in 2012 with the increased production of the Utica Shale. Of the 460 wells developed, there were 333 productive completions and 27 dry holes, equaling to a 93% success rate, a pretty good track record for Ohio’s operators.
The first horizontal Utica/Point Pleasant Shale well was developed and put into production in 2011. Overall, 25 wells were developed in 10 counties, with Carroll County being the most active with 12 wells. During 2011, 5 wells were put into production with the remainder of wells waiting to be completed or put into production. One of those wells developed in Carroll County actually set a record for the longest length of a well 14,445 feet, a number that will soon be broken when next year’s report comes out.
As we have seen in 2012, Utica permits have significantly increased with over 375 permits issued with Carroll County remaining the hotspot of Utica activity with over 136 permitted in the county. Thanks to multiple announcements by companies producing tremendous wells, Harrison County is following Carroll County with 57 permits issued. Columbiana County comes in third place in permit activity with 52. Rounding out the top five are Guernsey and Jefferson Counties with each issuing 18 permits over the past year.
Thanks to the increased permit activity, Ohio has seen astounding production numbers coming from the Utica by companies like Chesapeake and Gulfport. The production rates have added enthusiasm throughout the oilfield by companies hoping to be part of this great opportunity. It seems as though every week there is an announcement of a new company investing in Ohio, providing new revenue and jobs for its residents.
When the 2012 McCormac Report comes out, I have a feeling we will see counties like Carroll and Harrison continuing to leading the state. In that report, Ohio should also see even more increase in oil and natural gas production thanks to the development of the Utica Shale.