Utica Shale permitting activity in Ohio in April shrank by 41% compared to a year ago despite privately held Ascent Resources' seeming bid to replace Gulfport Energy Corp. as Ohio's top gas producer by volume.
April was the sixth month in a row in which Ascent pulled the most permits of any Utica driller. Founded by shale pioneer Aubrey McClendon after he was bounced from Chesapeake Energy Corp., Ascent has been stalking Gulfport for more than a year. According to company reports, Ascent produced 941 MMcf/d in the first quarter, while Gulfport produced 968 MMcf/d in the Utica for the quarter. Ohio's gas production figures for fourth quarter 2017 will be released later in May.
Gulfport executives told analysts during the company's first-quarter earnings conference call that their plan is to drill longer laterals rather than more new wells. "Our 2018 program focuses on maximizing lateral lengths and realizing economies of scale on our per-foot metrics," COO Donnie Moore said.
The largest contributor to the drop in Ohio permits came from two big drillers focused on the Marcellus Shale in Pennsylvania and West Virginia. The nation's top gas producer, EQT Corp., has not added to permits issued to Rice Energy before the merger of the two companies in November 2017 and did not mention the Utica during its most recent conference call.
Antero Resources Corp., the nation's top NGL producer, said it will focus on the liquids-rich Marcellus leases it holds in West Virginia for now. "We're pleased with the results there in the Utica, but … we're saying we're not expanding our CapEx program," CEO Paul Rady said during the company's first-quarter earnings conference call, noting that Antero turned 10 wells on two pads to production in December 2017. "Probably, the Utica is going to be 15% to 20% [of Antero's spending]. So even though these are outstanding wells, the economics on our Marcellus liquids wells are even stronger."
"[We] like the Utica, but it still plays a smaller role," Rady said. "We're not looking to expand the CapEx but just to keep it the same and keep our focus mostly on Marcellus liquids."