Moratorium

Erie, CO, officials voted 6-1 Monday night to end a six-month moratorium on new oil and natural gas drilling after securing agreements with producers that place stricter regulations on their operations.

Baker Hughes Inc. is seeing some deterioration in U.S. natural gas liquids (NGL) drilling activity, but activity in the Gulf of Mexico (GOM) has returned to pre-moratorium levels, CEO Martin Craighead told analysts on Friday.

Concerns over natural gas development and its potential to cause earthquakes continue to linger in Johnson County, TX, after the area has experienced about 10 modest quakes during the last month.

Ohio Gov. John Kasich signed an executive order on Tuesday temporarily giving the Ohio Department of Natural Resources (ODNR) additional power to regulate wastewater injection wells used by oil and natural gas drilling operations.

Banking on the possibility that New York will lift its moratorium on high-volume hydraulic fracturing (fracking) in the near future, Norse Energy Corp. ASA on Thursday completed a $37 million sale of operated production and other assets in the Empire State to EmKey Resources LLC (see Shale Daily, March 19), giving it cash to focus on core properties in the Marcellus and Utica shales in central New York.

Despite strict rules governing wastewater disposal wells, enacted after a dozen small earthquakes were possibly caused by the injections, the Ohio Department of Natural Resources (ODNR) is on pace to receive a record number of permit applications this year for new injection wells.

Legislators and regulators in New York are hinting that should high-volume hydraulic fracturing (fracking) be permitted in the Empire State, localities that are the most receptive to the practice may be the first — and, possibly, the only — areas to allow it.

The top geologists in Colorado and Oklahoma, two states with significant shale resources, say researchers with the U.S. Geological Survey (USGS) were hasty in suggesting that injection wells used to dispose of wastewater from oil and gas drilling are responsible for an increase in earthquakes in the Midcontinent region.

Representatives from a unit of BP plc began signing agreements with landowners in Trumbull County, OH, as the company readies to begin exploring its Utica/Point Pleasant Shale leasehold in 2013. In March BP completed an agreement with the Associated Landowners of the Ohio Valley to lease close to 84,000 acres in an unexplored area of the county, which is in the northeastern part of the state (see Shale Daily, March 28). With the agreements now in place, BP is executing individual terms with landowners, which may take up to six months. BP’s Ohio shale purchase moved it into ninth place among Utica/Point Pleasant leaseholders, according to data compiled from company reports by NGI’s Shale Daily. The top leaseholder is Chesapeake Energy Corp., which has an estimated 1.2 million net acres, followed by EnerVest and EV Energy Partners, which together lease an estimated 760,000 net acres. Chevron Corp. follows with 600,000 net acres.