Overview: Utica Shale production growth in 2014 (Part 5 of 7)
Positive 1Q14 earnings calls for Utica Shale investment
The 1Q14 earnings calls of the major players in the Utica Shale reflect positive sentiment toward the play.
Chris Doyle, the Senior Vice President of Operations, Northern Division, for Chesapeake Energy (CHK) said, “I’m exceptionally pleased with the continue performance and honestly our performance of the team that we have working the Utica.”
“As the press release indicated, we average about 50,000 barrels a day equivalent net from that asset and we are significant higher than that today. Just an update, the next tranche, the next bump up will come in the form of Kensington, the third train in Kensington. Now they’re $100 million a day.”
“We’re on track for June startup which is reflected in our forecast. We tied in that third train a couple weeks ago; we are finishing sort of final adjustments. Electrical and should be commissioned in couple weeks. This is the team that continues to out execute just starting volume in that play and you’ll see that in black and white next week and couldn’t be prouder of anything.”
The “train” refers to a natural gas processing plant at Kensington to which CHK, EVEP, Total, and EnerVest supply natural gas. By the end of 2013, the Kensington plant operated two processing trains with capacity to process 400 million cubic feet per day.
Mark A. Houser, the CEO at EV Energy Partners (or EVEP), commented on the oil production outlook of Utica Shale as, “Our estimates of oil in place through most of Tuscarawas, Stark, and Guernsey counties is around 20 million to 30 million barrels per section. Ascending the midpoint, this is about 5.5 million barrels of oil in place for a 140 acre well. Let’s say 400,000 barrels per well is needed for attracting economics with a good, sustained flow rate initiating from the IPs of 500 barrels to 700 barrels a day, this represents recovery of around 7% of oil in place, very similar to reported recoveries in other oil shale.”
“The challenge in the oil window appears to be fracture design and minimizing reservoir damage upon completion. We’re working with industry partners currently on some studies designed to help us better understand the flow capacity of the oil window rock. We still plan on drilling in the oil window later this summer and are closely monitoring on our oil window wells.”
Michael G. Moore, the CEO of Gulfport Energy, said, “As a management team, our confidence in the Utica remains very strong. We all have keen awareness that we are stewards of a world-class asset as well as the resources of our stockholders. With this knowledge, we also believe it is in the best interest to manage this asset for long-term, sustainable growth. We have learned from a number of techniques we have tested in the play and narrowed in on a methodical, systematic approach that we think will maximize long-term value.”