New permits for shale gas wells in Ohio's Utica Shale increased by one-third over August 2018 as private drillers pulled ahead of their publicly traded peers, according to Sept. 4 state data.
The Utica is coming to resemble the Haynesville Shale in Texas and Louisiana around Shreveport, La., where many of the most active drillers are all backed with private money, according to the latest Aug. 29 numbers from Enverus Drillinginfo's RigData. The top two drillers that pulled the most permits in Ohio in August are private firms.
Private equity-backed drillers are somewhat free from current investor pressures on public companies to restrain spending in the face of low natural gas commodity prices. This factor comes even more sharply into focus in Ohio because of the higher costs of drilling deeper Utica wells.
Ohio's top gas producer, Ascent Resources, nearly tripled its new shale permits pulled in August compared to a year ago, the state Department of Natural Resources said. Ascent is backed by private equity investors including ">The Energy & Minerals Group and First Reserve Corp. In the past two years, Ascent has added more than 1 Bcfe/d of production to finish the second quarter at 2.1 Bcfe.
Encino Energy LLC, backed by the Canada Pension Plan Investment Board, shifted its Utica operations into a higher gear in August. It pulled permits during the month for 11 new wells on acreage it obtained after buying out Chesapeake Energy Corp.'s Ohio operations for $2 billion in October. The 11 new permits mark a 57% increase in activity from last year under Chesapeake's management.
Both Encino and Ascent are led by a number of Appalachian shale gas veterans. Ascent's C-suite includes former Chesapeake executives who pioneered the Utica Shale a decade ago. Encino's chairman, John Pinkerton, and CEO, Hardy Murchison, worked together at Marcellus Shale pioneer Range Resources Corp.
Ascent pulled the bulk of its 22 August permits in Jefferson County, in the dry gas window along the Ohio River, with a smattering in the wet gas counties of Harrison and Guernsey. Encino focused almost exclusively on Harrison County, next door to Chesapeake's Carroll County starting point for the Utica play.

