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Annual Debrosse Report Shows Another Banner Year For Ohio's Oil/Gas Industry in 2015

While the state's conventional producers have largely been sidelined by the commodities downturn and their better-financed counterparts in the shale fields are feeling the squeeze more each day, 2015 was still another banner year for Ohio's oil and gas industry.

Martin Shumway, president of energy consulting firm Shumway Resources LLC, delivered an in-depth look at the state's oil and gas industry in the Debrosse Memorial Report, a high-level update of the finer aspects of the industry's operations in Ohio given each year. Shumway reviewed the report on Thursday before roughly 200 members and attendees of the Ohio Oil and Gas Association's annual meeting in Columbus, OH.

Last year, the Utica Shale was the primary source that drove up nearly all aspects of the report. There were 534 completions in Ohio in 2015 and 70% of them were done in the Utica, Shumway said. The formation also helped the state surpass an oil production record last year that was first set in 1896 in the Lima-Trenton field of Northwest Ohio, when wildcatters churned out 23.9 million bbl of oil. In 2015, combined conventional and unconventional oil production hit 25.7 million bbl, mainly from the Utica Shale.

Combined natural gas production was more than five times higher in 2015 than it was in 2011, when the state reported its first commercial Utica production (see Shale DailyApril 3, 2012). Unconventional production reached nearly 954 Bcf, while conventional production was 53 Bcf, tipping the state over 1 Tcf of combined production.

The Ohio Department of Natural Resources released year-end unconventional data last week (see Shale DailyMarch 9). The agency has not yet released conventional production data, but Shumway, who helped author the Debrosse report, said his conventional projection was based on the production declines of recent years.

Oil production, meanwhile, was more than 12 times higher than it was in 2011. Shale drillers produced 22 million bbl of oil, while legacy drillers produced 3.7 million bbl, according to the report.

The total measured depth (TMD) of each well in the state has increased exponentially as well, reflecting the laterals that shale drillers continue to elongate. In 2010, the report said, operators drilled 2.2 million feet of TMD statewide, compared to 6.6 million feet of TMD last year.

Chesapeake Energy Corp., Shumway said, accounted for the largest share of last year's total, drilling 2.3 million feet. While the company has idled its program in the play this year, it drilled the most wells in the state in 2015, reporting 144. The top-12 operators in the state -- all of them Utica drillers -- accounted for 91% of all footage drilled.

Harrison, Carroll and Belmont counties in Southeast Ohio also led the state in completions last year, combining for 243 of the 534. Those counties were also the top-three, respectively, in wells drilled and footage. They were also among the leaders in oil and gas production (see Shale DailyMarch 11).

But Monroe and Belmont counties, Shumway said, appear to be home to some of the best acreage and wells in the state. Estimated ultimate recoveries (EUR) in parts of both counties are ranging from 2.51-3.01 Bcfe per 1,000 feet of lateral, according to data in the report. Shumway added that the Utica EURs are competing strongly with those in the Marcellus Shale of Pennsylvania.

Ascent Resources LLC, which has a strong footprint in Belmont County, had the highest average initial production (IP) rates of any operator in the state last year, with nearly 19 MMcfe/d. Ascent was followed by Hess Corp., which had an average IP of 17.6 MMcfe/d and Antero Resources Corp., with 12.8 MMcfe/d, according to the report.

In all, there were 87 companies producing oil and gas in the state last year, Shumway said, down from a recent peak of 143 in 2009 shortly before the Utica Shale began its ascent as a leading resource play. In one sign of the downturn, however, Shumway said the number of new well permits issued in the state last year plummeted, going from 1,659 in 2014 to 957 in 2015.

The Debrosse report is compiled using publicly available data, some of which is analyzed closely to make estimates or projections. It shows that about 275,000 oil and gas wells have been drilled in Ohio since 1860. There are about 50,000 producing wells, more than half of which are about 25-39 years old.

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