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Gulfport Energy returns to Ohio, but Ascent's permitting shows it will stay king

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Gulfport Energy returns to Ohio, but Ascent's permitting shows it will stay king

After halting all drilling and well completions in Ohio in the third quarter of 2018, oil and gas producer Gulfport Energy Corp. is back in the game, filing three permits for new wells in liquids-rich Harrison County at the end of the year, according to the latest state data.

Once Ohio's leading gas producer, the Oklahoma City-based Gulfport decided a backlog of drilled but uncompleted wells and calls for cash for new wells closer to home in Oklahoma's SCOOP play warranted a halt to Ohio activity. "When you have 55 [drilled but uncompleted wells] in inventory, to continue to drill and add to that inventory for us in this quarter just really didn't make sense," COO Donnie Moore said on Gulfport's third-quarter 2018 earnings conference call. "In the Utica, you're probably looking at starting a rig early sometime next year, one to two rigs."

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Gulfport also filed for nine new wells in the first week of 2019, split between Harrison and dry-gas-heavy Belmont County, according to Ohio Department of Natural Resources.

The state's new top gas producer, the privately held Ascent Resources, also based in Oklahoma City, pulled the most permits by far of any producer in December 2018, with 18. Ascent, with a C-suite stocked with executives who pioneered the Utica play while at Chesapeake Energy Corp., split those permits between three counties: dry gas Belmont and Jefferson counties and Guernsey County in the wet gas window.

Producers pulled 29% fewer permits in December 2018 than a year earlier, in line with a trend toward fewer permits all year. For the full year, Ohio drillers pulled 279 permits for new wells, 38% fewer than in 2017.

Fewer permits did not mean less gas production, as producers have become more efficient and drilling technology and tactics improve. Full-year 2018 figures will not be available until February at the earliest, but Ohio's 6.9 Bcf/d of dry gas production in the third quarter was 39% more than in the same quarter in 2017 despite fewer new wells, according to state data.