Shale Development in Ohio


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Shale Development in Ohio

  1. 1. Ohio Environmental Council Clean Water Conference 08/06/2011Ohio Department of Natural Resources Shale Development
  2. 2. OOn Behalf o e a of:Director: David MustineAssistant Director: Scott ZodyDeputy Director/Acting Chief:Mike BiddisonPresenter: Tom Tugend
  3. 3. State Budget Bill Changes Oil and Gas program will become a stand alone division – will split off from DMRM Acknowledgement of the importance for a direct focus on oil and gas regulation in relation to the pending shale development
  4. 4. A Little History
  5. 5. Wells Drilled and When Year Wells Drilled 1895 189 6147 614 1930 2134 2008 1087 2010 431
  6. 6. Our Legal Authority Ohio Revised Code 1509 Ohio Administrative Code 1501 Our marching orders Sets S t our boundaries b d i RC 1509 effective in 1965 – Morrow County “oil boom”
  7. 7. Our Legal Authority Continued From 1893 – 1965 the minimal regulations in place were p primarily self enforced with y the focus on miner safety
  8. 8. Basis of the Oil and Gas Laws and Rules Conservation Protection of the environment and public health and safety
  9. 9. Basis of the Oil and Gas Laws and Rules Conservation Based Laws and RulesFor the effective development of Ohio’s oiland natural Gas resources to PreventWaste - Maximize Recoverable Resources -
  10. 10. SENATE BILL 165 – EFFECTIVE 06/30/10 Cont. Strengthened enforcement g Provided additional funding: For operations and Orphan Well Program p p g Increased insurance requirements Provided for additional notifications: Commencement of drilling, fracking, placement of conductor, surface and production casing {Provided for more opportunity for staff to oversee operations}
  11. 11. Shale Exploration
  12. 12. PA – Where is the Marcellus Activity A ti it The PA Marcellus “Fairway”Gold = Primary Area of Marcellus Drilling Activity [“The Fairway”]
  13. 13. PA – Where is the Marcellus Activity Red = Marcellus
  14. 14. Marcellus Shale Activity y Pennsylvania2011: 1,600 (projected)2010: 1,454 Marcellus wells drilled 1 4542009: 763 Marcellus wells drilled2008: 195 Marcellus wells drilled2004: R2004 Range Resources d ill d the first R drilled th fi t horizontal shale well
  15. 15. Differences Between a Horizontal Well and Traditional Vertical Well Everything is bigger – It takes longer  Well it 3 5 W ll site 3-5 acres vs. 1 2 acres 1-2  Shale rig is much larger g g  Associated equipment – more of it
  16. 16. Differences Between a Horizontal Well and Traditional Vertical Well One month/well to drill vs. one week vs6 or more wells can be drilled from one well site pad or back to back $5 million vs. $400,000 to drill
  17. 17. Possible Game Changer The Utica Shale may contain significant quantities of natural gas liquids (condensate) and oil ( d t ) d il If so and once proven, drilling activity could increase quickly in Ohio
  18. 18. Hydraulic Fracturing Cont.Ohio Hydraulic Fracturing State ReviewJanuary 2011 by: 2011,State Review of Oil and Natural GasRegulations, Inc (S O G ) egu at o s, c (STRONGER)
  19. 19. Hydraulic Fracturing Cont.Eight officials (Industry, regulatory,environmental) reviewed Ohio’s i l) i d Ohi ’hydraulic fracturing regulatory p g y g g y programand found:
  20. 20. Hydraulic Fracturing Cont. Ohio’s program is well managed, professional and meeting it s program it’s objectives.
  21. 21. Protection of the Environment and Public Health and Safety Key Factors: Permitting Well site construction Well construction ! Well control ! Fluid control ! Oversight
  22. 22. PARTNERSHIPS ODNR/DMRM has more partners than h t th ever in the past - this is good OEPA, USACE, MWCD, Jobs and Family Services, Ohio Shale Coalition, OGEEP, OSU Cooperative Extension, Ohio Farm Bureau, PUCO……… Bureau PUCO
  23. 23. Ohio Shale Wells Permitted/DrilledMarcellus Shale Horizontal permits issued 13 Horizontal wells drilled 5Utica Shale Horizontal permits issued 26 Horizontal wells drilled 8 Total companies having permitted and drilled hori ontal shale wells 8 horizontal ells
  24. 24. Who Are The Current Shale Players Chesapeake p Ohio Buckeye Marquette Triad-Hunter Protégé P té é Enervest Phillips Exploration
  25. 25. Who To Expect Anadarko CNX Chevron Talisman Gulfport Shell Sierra HG Others
  26. 26. What To Expect Past vs. Future – Visual Depiction
  27. 27. Billy Bob’sOilfield Security