Utica shale report finds 133 pipeline projects in eastern Ohio from infrastructure rush

Source: Columbus Business First

Oil and natural gas production in the Utica shale play could get into full swing next year as multiple pipelines and processing plants are brought online to ease logjams at wellheads, says a Columbus attorney who tracks Ohio’s shale gas industry.

“What I get from industry and pipeline people,” said Chip Collier of Benesch Attorneys at Law, “is they’ll work through (the rest of this year) to get the infrastructure in place. Then in 2014 wells will go into full production.”

He filled me in after the release of Benesch’s quarterly shale industry report. Among its findings are 133 pipeline projects are said to be planned or in progress in Ohio and companies such as Pennant Midstream, MarkWest Utica EMG. and Crosstex Energy are building or planning investments in processing facilities.

“That’s a lot of pipeline activity, even more than I had imagined,” Collier told me. “(Companies) are spending billions of dollars to get infrastructure ready.”

As I’ve reported, the lack of the pipelines and processing plants in eastern Ohio are holding back production of oil and natural gas in the Utica play. The most recent numbers from the Ohio Department of Natural Resources bear that out, showing 882 drilling permits have been issued in the Utica, 542 wells have been drilled but only 152 are in production.

“There will be a big jolt (in production) from existing wells when it does break,” Collier said.

He also said railroads and trucking companies are expanding to help move oil and natural gas liquids from well fields to refineries and other processing sites. We’ve reported on Crosstex reactivating a rail terminal east of Newark while the Benesch report calls Columbus & Ohio River Railroad’s mile-long siding to a loading facility and terminal in Harrison County a “game changer” for the Utica play.