BP ends Utica shale exploration program
BP America announced in April that it will not proceed with development of its leasehold in the emerging Utica shale, and regulatory filings show the company recorded a $521 million write-off relating to its Ohio Utica assets in the first quarter of 2014.
Brian Gilvary, chief financial officer of BP, declined to say if the company had any plans for the Utica acreage. "In terms of Utica we've taken the write-off of the assets where we've made the appraisal wells, it's premature to say what we'll do with the remaining parts of that asset base," Gilvary told a call to discuss first quarter results on Apr. 29.
The news that BP is exiting the Utica shale comes as the company makes plans to create a separate business unit for its onshore oil and gas activities in the US Lower 48.
BP acquired its position in the Utica shale in March 2012, leasing about 84,000 acres in Trumball County, in far northeast Ohio, from the Associated Landowners of the Ohio Valley.
Information from the Ohio Department of Natural Resources shows the bulk of Utica drilling activity is occurring south of BP's leasehold, in Carroll, Harrison, Columbiana, Noble, and Guernsey counties. The agency had issued 1,230 permits to drill in the formation in late April.
Rex Energy advances Utica shale program
Rex Energy Corp. has brought three Utica shale wells online in its Warrior North Prospect in Carroll County, Ohio.
The wells were drilled from the Ocel pad and placed online at an average 5-day sales rate of 1,470 boe/d comprised of 48% NGL, 44% gas, and 8% condensate. The wells flowed at an average casing pressure of 1,560 psi on a 26/64-in. choke.
The Ocel pad wells were drilled to an average total measured depth of 12,700 ft with 4,400-ft laterals, and completed using 29 frac stages.
"Our most recent results in the Warrior North Prospect further confirm the potential of our assets in Carroll County," said Tom Stabley, chief executive officer of Rex. Rex now has eight wells flowing into sales at the Warrior North Prospect and has identified more than 100 additional drilling locations.
Rex holds 21,300 net acres in the liquids and condensate window of the Utica shale in eastern Ohio, including 16,900 net acres at its Warrior North prospect in Carroll County and 4,400 net acres in its Warrior South prospect in Guernsey County. The company, based in State College, Pa., plans to this year drill 11 wells using a one-rig program in the Utica shale.
Rex is also active in the Marcellus shale in western Pennsylvania and in the Illinois basin, where it is perusing an enhanced oil recovery project in eastern Illinois and western Indiana. The company has a capital spending budget of $350-365 million for 2014 and expects annual production to average 143-149 MMcfe/d.