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Gas well snapshot shows high-producing Ohio wells

Andrew Welsh-Huggins, Associated Press

COLUMBUS, Ohio (AP) -- Natural gas wells using the drilling method known as hydraulic fracturing are producing at a much higher rate than traditional wells, according to the first look at production figures from nine active wells in the Utica Shale formation in eastern Ohio.

Figures reported Monday by Oklahoma City-based Chesapeake Energy Corp. show five wells in eastern Ohio producing 2.6 billion cubic feet of natural gas in 2011. The other four wells produced hundreds of barrels of oil but are not in natural gas production yet, according to Chesapeake.

The report, which Chesapeake provided to the Ohio Department of Natural Resources, shows one well in Harrison County producing 1.5 billion cubic feet of natural gas, or 2 percent of the state's entire natural gas production.

Put another way, that well has 300 times more in daily production than the average well drilled vertically into the ground, said Rick Simmers, chief of ODNR's Division of Oil and Gas Resources Management.

"The preliminary production for all the wells on the gas side is very high," Simmers said.

Companies including Chesapeake have drilled 38 other wells that have yet to report production.

Ohio has issued about 150 permits for Utica Shale wells in Ohio. By contrast, the state has about 49,000 traditional gas wells reporting production of about 73 billion cubic feet in 2011.

The figures continue to fuel Chesapeake's optimism about the formation, spokesman Keith Fuller said in a statement. "The data reported, while promising, is still very limited and only a small part of the information needed to gauge the potential of the entire formation," he added.

The data reported Monday involves wells drilled using a method dubbed "fracking," in which thousands of gallons of chemically laced water are blasted into shale deposits, freeing natural gas trapped in the layers of shale.

The natural gas reported Monday includes both "dry" gas that can be distributed almost immediately to gas companies for home and business use, and "wet" gas that includes other proponents such as butane and propane that must be stripped out, Simmers said.

Eastern Ohio is in the midst of a natural gas boom as developers seek to capture rights to Utica Shale deposits. Last month, BP announced it had leased 84,000 acres of land in the Utica/Point Pleasant shale formation in northeast Ohio for oil and gas production.

The Utica Shale lies below the Marcellus Shale, where oil companies in Pennsylvania have drilled thousands of wells in search of natural gas and, more recently, oil.

Also last month, Chesapeake announced a $900 million project for gathering, compression and processing of natural gas and natural gas liquids. The project will roll out over five years, with parts of the complex scheduled to begin operations by June 2013.

Decisions by Chesapeake and BP to develop in Ohio come despite a proposal by Republican Gov. John Kasich to hike the taxes that oil and gas drillers pay for extracting the state's natural resources. Ohio's oil and gas association has criticized Kasich's plan as a potential turnoff to drilling activity. The governor wants to use the proceeds to fund a modest statewide income-tax reduction beginning in 2016.


Andrew Welsh-Huggins can be reached at https://twitter.com/awhcolumbus.