20 Dec What is Utica Shale
THE FUTURE OF NATURAL GAS
The large Marcellus formation which extends across much of the North Atlantic region has been well-known for its potential in the energy industry, but a new source has been making headlines in Ohio – the Utica Shale.
What is Utica Shale and what does it mean for the energy industry? The layer of rock under the earth which extends from Quebec, Canada to Kentucky with major portions located in Ohio, Pennsylvania and West Virginia has been touted as the next big play for shale gas and has attracted billions of dollars in land investment. According to an estimate from Ohio state geologists, their portion of Utica alone could contain up to 15 trillion cubic feet of natural gas, making it a significant contributor to the energy industry and the potential to create thousands of jobs.
In 2011 drilling activity in the Utica shale was concentrated primarily in eastern Ohio, where the Utica shale is only a few to several thousand feet below the surface. Early wells drilled into the Utica Shale were producing significant results of natural gas, significantly increasing the value of the well. Billions of dollars were spent throughout 2011 by natural gas companies acquiring Utica Shale acreage in the area. The Ohio Department of Natural Resources estimates recoverable Utica Shale potential from 1.3 to 5.5 billion barrels of oil and 3.8 to 15.7 trillion cubic feet of natural gas.
With the economic potential and promising results in eastern Ohio, drilling companies have inundated the Ohio Department of Natural Resources with permit applications. Chesapeake Energy 2011 second quarter financial data believes that future assets of $15 – $20 billion will be added in value to the company as a result of Utica Shale. An industry-funded analysis says that the Utica Shale development will create over 200,000 jobs by 2015 in Ohio alone.
With the economy and the future of energy at the forefront of political campaigns, as well as on the minds of Americans in terms of the future, it is to be expected that we will hear more about the Utica Shale in the near future.