Utica Shale

PDC Energy Updates Utica Shale Program

PDC Energy (PDCE) updated the company’s Utica Shale development program, where the company has 45,000 net acres spread across Guernsey, Noble, Washington and other counties in Ohio.

PDC Energy is no longer looking for a joint venture partner in the Utica Shale as the company felt that the offers received did not provide enough value to shareholders.  The company will develop the acreage on a standalone basis.

PDC Energy plans to spend $95 million in capital in the Utica Shale in 2012 and estimates 2013 spending at $50 million.  The company has disclosed information on three wells to date:

Onega Commissioners #14-25H – This well is currently being completed and then will be shut in for 60 days prior to a flow test in November 2012.

Detweiler #42-3H – This well will be completed by the end of 2012 and will be flow tested in the first quarter of 2013.

PDC Energy expects to spud its third horizontal Utica Shale well in the fourth quarter of 2012.

Magnum Hunter Resources Adds To Utica Shale Position

Magnum Hunter Resources (MHR) reported the purchase of additional leasehold in Ohio that is prospective for the Utica Shale formation.

Magnum Hunter Resources purchased approximately 15,558 gross or 12,186 net acres for $24.8 million, or a net price of $2,037 per acre.  The acreage is located in Noble County, Ohio.

Magnum Hunter Resources said that the majority of the acreage was held by production from shallower formations.

Magnum Hunter Resources said that the acquired acreage is close to the company’s existing position in Washington and Noble Counties, and brings its total position prospective for the Utica Shale to 23,214 gross or 17,316 net acres.

PDC Energy Enters Utica Shale Play

PDC Energy (PETD) announced the acquisition of leasehold in Ohio that is prospective for the Utica Shale. The acreage is in the wet gas or liquids portion of the play.

PDC Energy is paying $50 million for 30,000 net acres located mostly in Noble, Monroe, Washington, Morgan and Guernsey counties.  The company said that 75% of the acreage is held by production from shallower wells.

PDC Energy plans to drill a vertical test well in the fourth quarter of 2011, followed by two horizontal wells into the Utica Shale in 2012.  The company has an option to drill two additional vertical wells in 2012.

PDC Energy will pay $10 million in 2011 and the balance in 2012 upon title confirmation.  The company will fund the purchase with its credit facility. The company is looking for additional opportunities and plans to increase its Utica Shale leasehold to between 80,000 and 100,000 net acres by the end of 2012.

PDC Energy is also looking for a joint venture partner to share the risk and cost of developing the Utica Shale leasehold.