While media outlets across the nation are touting the economic success Utica Shale development has ushered into Ohio, a recent Reuters article entitled  “Is Ohio’s “secret” energy boom going bust?” took a much different approach.  In seeking to manufacture a controversy where none exists the article did more to confuse readers than it did in telling the story of Utica Shale development.

The failure of the piece is simple. In seeking to incite divisiveness, the article misses the fact that the data it claims is “secret” is already being voluntary disclosed. While it is true that here in Ohio companies are only required to report their production data once a year, many have taken the lead in sharing  this data through investor calls and field updates.

What Reuter’s reported as a possible “bust” flies in the face of production data already released and a recent USGS study. That study declared the Utica holds 38 trillion cubic feet of natural gas, a mean of 940 million barrels of oil and a mean of 208 million barrels of natural gas liquids.  These numbers, like many federal government resource estimates that have come before, are a conservative estimate based on data from limited development.

First and foremost, the Reuters article declares “The growing concern among many is that the Utica, far from being the oil-rich patch originally believed, is largely filled with natural gases and related liquids, whose prices have slumped to near break-even rates for drillers.”

Compare that statement to an article published in April by the Columbus Dispatch highlighting early returns from a pair of Anadarko wells:

“The Houston-based company says one of the wells in Noble County delivered 9,500 barrels of crude oil and 12 million cubic feet of natural gas in just 20 days. The other two, both in Guernsey County, had a combined total of 20,000 barrels of oil and 37 million cubic feet of natural gas in about two months.”

In addition to these impressive returns, Chesapeake Energy released production data on nine of its wells during 2011.  These wells, in production from anywhere between five days and 206 days, produced 46,326 barrels of oil. Meaning only 11 Utica Shale wells produced almost 70,000 barrels of oil.

Meanwhile, additional production data from companies like Gulfport  indicate that we have only discovered the tip of the Utica iceberg and that there is plenty of reason for optimism on the resources the Utica contains.  A review of this data shows:

CONSOL– During the 24 hour flow back test the Noble 1A well peak rate tested at a rate of 9.0 million mcf a day of natural gas and about 10 barrels per day of condensate.

Gulfport Shugert Well– During a 32 hour flow test, the Shugert 1-1H tested at a peak rate of 20.0 million cubic feet (“MMCF”) per day of natural gas, 144 barrels of condensate per day, and 2,002 barrels of natural gas liquids (“NGLs”) per day, assuming full ethane recovery, and a natural gas shrink of 17%, or 4,913 barrels of oil equivalent (“BOE”) per day.

Gulfport’s Boy Scout 1-33H– The well tested at a peak rate of 1,560 barrels of condensate per day and 7.1 MMCF per day of natural gas as well as 1,008 barrels of NGL per day assuming full ethane recovery and a natural gas shrink of 25%, or 3,456 barrels of oil equivalent per day.  Through composition testing the gas registered at a 1,310 btu rating making it liquids rich.

Gulfport’s Wagner Well– Produced a peak rate of 17.1 million cubic feet (“MMCF”) of natural gas per day, 432 barrels of condensate per day and 1,881 barrels of natural gas liquids per day assuming full ethane recovery and a natural gas shrink of 18%, or 4,650 barrels of oil equivalent per a day.  These numbers are very promising for those developing the Utica Shale, especially in Harrison County.

Enervest’s Cairns 5H well – Located in Carroll County, Ohio, near the border with Tuscarawas County, flow tested at a 24-hour rate of 1,690 barrels of oil equivalent per day. The production mix was 729 barrels of 52-degree API condensate per day, 2.2 MMCF of natural gas per day and 587 barrels of natural gas liquids per day.

But this isn’t the first time a news outlet has tried to damper expectations for an emerging shale play.   As you may recall, just last year the New York Times  pushed a similar narrative when it interpreted government data on the Marcellus Shale. The paper stated:

“the Marcellus shale, which was previously thought to hold enough gas to meet the entire nation’s demand for 17 years at current consumption rates, contains instead a six-year supply.”

Now fast forward to this week when ITG Investment Research, a worldwide financial firm based in New York, released a study that looked at production data from the Marcellus and concluded it holds 330 trillion cubic feet of gas recoverable with today’s technology.

To anyone paying attention, the only conclusion to draw from the early data coming from the Utica Shale is that it  is already putting up impressive numbers and we are only in the beginning  its development.

Like the Marcellus Shale, the reports of the Utica’s death are greatly exaggerated.

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