Consol Energy Inc. announced Friday that it would begin shifting its Utica Shale program in Noble County, OH, from exploration to development mode, after seeing encouraging results and data from its test wells and those of its competitors in the play.

The Canonsburg, PA-based company also said its natural gas division produced 41.8 Bcfe during 4Q2012 — a 5% increase over the 39.7 Bcfe produced in 4Q2011 — while natural gas production for the full year 2012 was 156.3 Bcfe net.

Consol said it predicts production will range from 170 to 180 Bcfe net for the full year 2013, and 39 to 41 Bcfe during 1Q2013. The latter is a slight decline from the 41.8 Bcfe produced during the preceding quarter, which the company blamed on hydraulic fracturing (fracking) schedules and other seasonal factors.

In the Utica, Consol said it has completed its second well in Noble County. The NBL 16A well was completed with 16 frac stages, and tested at 12 MMcf/d of natural gas and 768 b/d of condensate (see Shale Daily, Oct. 17, 2012).

“This well is currently shut in for further dissipation of frac fluids and the installation of a gas gathering system,” Consol said. The company added that early results from NBL 16A and a second well, NBL 1A, plus data from its competitors, “gives the company confidence to begin transitioning…from an exploration mode to a development mode.”

Consol said it currently has two horizontal drilling rigs in the Utica, and plans to drill 11 wells in Noble County in 2013. The company estimated that production from the 11 planned wells would be less than 5 Bcfe because of infrastructure requirements.

Elsewhere in Ohio, Consol drilled and completed one well (PORT 2A) in Portage County, one well (TUSC 3A) in Tuscarawas County, and one well (MAH 2A) in Mahoning County. A second well in Tuscarawas County (TUSC 8A) is scheduled to be completed during 1Q2013, while two additional wells in Mahoning (MAH 7A and 7C) are to be completed in 2Q2013.

Consol is a joint venture (JV) partner with Hess Corp. in the Utica (see Shale Daily, Sept 8, 2011). According to Consol, Hess drilled two wells and completed one well for the JV in 2012, and has one rig in Hess’ operated portion of JV acreage in eastern Ohio. That rig will be used to drill 16 horizontal wells in the Utica for the JV in 2013.

In the Marcellus, where Consol has a JV with Noble Energy Inc. (see Shale Daily, Aug. 19, 2011), there was also success in 2012. The company said the JV drilled 89 gross wells during the year — 64 by Consol and 25 by Noble. Of the 64 wells drilled by Consol, the average 24-hour flow rate totaled 8.1 MMcf/d, while the average 30-day rate was 4.7 MMcf/d and estimated ultimate recovery (EUR) per well averaged 5.9 Bcfe.

The company said it currently has two horizontal drilling rigs in southwest Pennsylvania, and plans to drill 23 wells in Greene and Washington counties, PA, in 2013. And although Consol doesn’t have any rigs in central Pennsylvania, the company said that in 2013 it plans to drill five horizontal wells targeting the Mamont field in Westmoreland County.

In northern West Virginia portion of the Marcellus, Consol said it has completed three wells in Barbour County and six wells in Upshur County, with EURs of 7.5 Bcf and 3.2 Bcf, respectively. The company said it currently doesn’t have any drilling rigs in the region, but plans to drill eight wells in Barbour County — six near Philippi and one each near Audra and Century — to test the productivity of its leasehold in southern Barbour County and northern Upshur County.

Consol, through its JV with Noble, continued its shift toward wet gas areas of the Marcellus (see Shale Daily, April 18, 2012). The company said Noble drilled 25 wells and completed 20 wells in wet gas areas of the play in 2012. According to Consol, current production from the 20 completed wells is greater than 39 MMcf/d of natural gas and 300 b/d of condensate.

Consol recently announced that it would spend most of its capital expenditure budget in 2013 on natural gas production in the Marcellus and the Utica (see Shale Daily, Jan. 15). The company said it plans to spend $600 million to develop its assets in the Marcellus, including $415 million for drilling wells.

Another $122 million would be spent developing assets in the Utica, including $90 million for drilling Consol’s share of 27 gross wells. Under the terms of a drilling carry, Hess pays 75% of the drilling costs in the Utica, while production is split 50-50.