[Subjectivist]

Speaking of cornucopianism, Opportunity Ohio is releasing new video's every week or so promoting the Utica Shale and opposing the proposed severence tax that is working its way through the state legislature.

http://vimeo.com/63064869 part one

http://vimeo.com/63506510 part two

http://vimeo.com/64028439 part three

Each of them is under 3 minutes to watch, I find them somewhat effective because they push the right buttons to strum your heart strings if you live in this state.

[Tanada]

$this->bbcode_second_pass_quote('', 'n') the wake of a policy consortium's report critical of the boost in jobs from the shale boom in the tristate area, Ohio has come out with numbers telling a different story.

There were 8,192 jobs in drilling and pipeline construction in Ohio in the first quarter of 2013, according to state data reported on by Columbus Business First. It's an increase from the first quarter of 2011's 6,263 and up 12 percent from the 7,329 in the first quarter of 2012.

These are just the core shale-related jobs in Ohio, not the jobs that are directly impacted.

[copious.abundance]

Hey, it's still early.

Was reading lots of stuff earlier in the year that the oil window in this shale was a looking bit disappointing, though the jury is still out. But there's no doubts about the wet and dry gas windows.

And it's not very exciting as of yet, but Ohio c&c production has finally started ticking up the past few months:
http://www.eia.doe.gov/dnav/pet/hist/Le ... RFPOH2&f=M

[Tanada]

$this->bbcode_second_pass_quote('copious.abundance', 'H')ey, it's still early.

Was reading lots of stuff earlier in the year that the oil window in this shale was a looking bit disappointing, though the jury is still out. But there's no doubts about the wet and dry gas windows.

And it's not very exciting as of yet, but Ohio c&c production has finally started ticking up the past few months:
http://www.eia.doe.gov/dnav/pet/hist/Le ... RFPOH2&f=M

[copious.abundance]

I was actually thinking of doing that, but of course at 21K bpd it would have been a joke.

[Tanada]

$this->bbcode_second_pass_quote('copious.abundance', 'I') was actually thinking of doing that, but of course at 21K bpd it would have been a joke.

[copious.abundance]

$this->bbcode_second_pass_quote('copious.abundance', 'H')ere is a more recent map showing the (known) extent of the Utica shale in Ohio. Looks like it covers about 1/3 of the state (give or take), with the oil and wet gas windows covering maybe 1/4 of the state. So that's about 10,000 square miles.


link

[Subjectivist]

The Ohio DNR 2nd quarter report for the Utica Shale wells in this state is out now.

http://oilandgas.ohiodnr.gov/portals/oi ... 100114.xls

Based on the totals at the bottom the shale wells produced 2,469,000 bbl in the second quarter this year. By my math that is around 27,000bbl/day.

Not super huge, but not bad either.

[shallow sand]

What are the cost ranges for Utica wells? The production amounts reported for oil would be good for conventional wells, but don't seem to strong on average compared to the three big US horizontal areas. Agree it is still early, but lower oil price and low natural gas price won't help. Also assume big decline so if they are below 100 bbl per day quickly, may not work until oil price spikes.

[shallow sand]

From my reading Utica is primarily gas, like Marcellus. Looks like gas rates can be huge though.

[Subjectivist]

$this->bbcode_second_pass_quote('shallow sand', 'F')rom my reading Utica is primarily gas, like Marcellus. Looks like gas rates can be huge though.

[shallow sand]

Nat gas seems to be strengthening also. May get the reverse of Bakken, EFS & Permian, in that Utica gas drillers will increase production of "associated oil".

[Subjectivist]

I missed this when the announcement was made in August, the Utica Shale play in eastern Ohio has completed its 1,000th well according to the state agency that approves drilling.

http://youtu.be/xZy5KZcF37c

I wonder how WTI prices will effect the economy here? Some folks laughed when I said Utica is very important to the Ohio economy, but I for one do not find any humor in the current volatility in the oil market. Ohio needs these jobs.

[Subjectivist]

$this->bbcode_second_pass_quote('shallow sand', 'W')hat are the cost ranges for Utica wells? The production amounts reported for oil would be good for conventional wells, but don't seem to strong on average compared to the three big US horizontal areas. Agree it is still early, but lower oil price and low natural gas price won't help. Also assume big decline so if they are below 100 bbl per day quickly, may not work until oil price spikes.

[copious.abundance]

$this->bbcode_second_pass_quote('Subjectivist', 'I') wonder how WTI prices will effect the economy here? Some folks laughed when I said Utica is very important to the Ohio economy, but I for one do not find any humor in the current volatility in the oil market. Ohio needs these jobs.

[Tanada]

$this->bbcode_second_pass_quote('', '[')b]Ohio misses on severance tax

The responsible use of Ohio’s natural resources is crucial to the well-being of its residents and to the long-term sustainability of its economic infrastructure. Currently, Ohio is 13th among states in terms of crude oil production and 6th in terms of natural gas.

The Marcellus and Utica shale formations, which lie, in part, under the hills of eastern Ohio, are two of the most important sources of natural gas in the United States. Since the rise of hydraulic fracturing (also known as “fracking”) in 2010, more than $40 billion worth of natural gas has been extracted from Ohio’s shale deposits.

However, the astounding wealth that has been created from state resources and using state infrastructure has overwhelmingly benefited a small number of rather large pockets. The expansion of oil and gas production locks in future greenhouse gas emissions in a time when the need to mitigate our contributions to climate change is more desperate than ever.

If Ohio policymakers refuse to embrace safer energy technologies, then they should at least ensure that oil and gas extraction increases the shared prosperity of the people of Ohio rather than fueling short-term private gains.

It is time for Ohio’s oil and gas drilling corporations to pay their fair share. Ohio still has significant untapped reserves of hydrocarbons and their extraction should be subject to a severance tax at the level of other major gas- and oil-producing states.

A fair state-level severance tax would help ensure that the exploitation of Ohio’s hydrocarbons funds critical state services responding to the pressing needs of all Ohioans and the prospects of their children. Furthermore, a severance tax permanent fund — sometimes called a legacy fund — like those of other gas-producing states and tribal nations, would go a long way toward a thriving Ohio beyond the ups and downs of the fracking boom.

A permanent fund produces a sustainable investment endowment that generates revenue from interest earnings that can be used to finance the needs of a region or state.

Over the years there have been several attempts to legislate a fair severance tax in Ohio. In 2015, Republican Gov. John Kasich proposed a 6.5% severance tax on gas and oil production and a 4.5% tax on natural gas liquids.

Years earlier, Policy Matters Ohio proposed a flat 5% severance tax on gas and oil and, after certain trigger points, a 2.5% fee toward a legacy fund that could provide long-term benefits despite the volatility of oil and gas markets. However, after an aggressive lobbying campaign from the Ohio Oil and Gas Association and the American Petroleum Institute, lawmakers refused to act.

Ohio drilling operators pay a dime per barrel of crude oil and half a nickel per thousand cubic feet of natural gas. This is one of the lowest severance taxes in the country and it means that years of gas and oil production have enriched corporations and drillers but not the communities that host them nor the state that supports them.

The promises made by oil and gas corporations never materialized and the Appalachian counties that were supposed to thrive have grown poorer. According to a recent Ohio River Valley Institute report, in the period between 2008 and 2019, gas-producing counties (Belmont, Carroll, Guernsey, Harrison, Jefferson, Monroe and Noble) had a net job loss of 8%, growth in personal incomes lagged state and national averages, and the local population decreased by over 5%.

These statistics only scratch the surface of the negative local impacts that have ravaged eastern Ohio in the past decade. All this while the same counties grew, in terms of GDP, five times faster than the state of Ohio and four times faster than the nation as whole. In other words, Ohio’s gas producing counties are being drained of both their natural resources and their economic vitality at the same time.

What would have happened if the General Assembly had instituted one of the several severance tax proposals since 2010 — say, the one proposed by Policy Matters? Based on Ohio Department of Natural Resources data, a flat 5% severance tax on crude oil and natural gas going back to 2016 would have produced more than $1.5 billion in revenue, $1.244 billion more than under current severance taxes.

[ROCKMAN]

T: Long,long ago I pointed out how some states charged a rediculously low severance tax. But that's the choice of the state's oil/NG regulators. But remember it's a free market. When you sell your house you can ask for any price you want. And if you ask 3X the market value you're not going to sell it. Your choice. Raise severance tax too high and fewer wells may be drilled. Folks in Ohio should have taken a trip to Austin long ago to talk to the Texas regulators about setting severance tax rates. In addition to helping our annual budget out a good bit we were also able to put away a $10 BILLION "rainy day" fund.