A Closer Look at PA’s Unconventional Production Data
By Matt Kelso, Manager of Data and Technology
Twice per year, the Pennsylvania Department of Environmental Protection (PADEP) releases its unconventional oil and gas production and waste reports, which is a good opportunity to check on what’s happening with the industry as a whole. In the past, FracTracker has analyzed this data as soon as it became available. That strategy proved to be a mistake, however, as it is common for some of the operators to release data after the deadline, meaning that early versions of the report can be incomplete. To mitigate the effects of late reporting, the data in this analysis was downloaded from the PADEP on March 10, 2015, several weeks after the reports were first published.
While the production and waste reports are released together, and appear together on the same map below, the FracTracker Alliance will analyze the data from these two reports in separate blogs, with this one focusing on PA’s unconventional production data.
PA Unconventional O&G Production and Waste – July 1, 2014 to December 31, 2014. Click here to access the full screen map, with legend, details, and additional controls.
The production report lists the amount of gas produced per well in thousands of cubic feet (Mcf), as well as oil and condensate totals in 42 gallon barrels. Also included are the spud date and the number of days that each well produced in each of the three categories. This allows us to take a look at how the age of the well factors into its daily production rates:
The average daily production values in Figure 1 were calculated from all wells reporting production for the given commodity type. For example, of the 1,467 wells on the report with a spud date in 2010, 1,221 (83.2%) of those produced some gas in the latest reporting period, and the average daily production of that group is 1,300 Mcf. Only 102 wells spudded that same year reported condensate production, averaging 6 barrels per day, and 35 wells produced oil, also averaging 6 barrels per day. It’s also worth pointing out that the majority of wells drilled last year were not yet in production for the reporting period.
Wells drilled in 2013 produced 38% less gas than wells those drilled in 2014, and the newer wells are producing 4.4 times as much as wells drilled in 2010.
In Pennsylvania, gas production amounts are quite high, while liquid hydrocarbon returns are fairly modest. In this six month period, operators reported 2.13 trillion cubic feet of gas production, 2.1 million barrels of condensate, and 171 thousand barrels of oil. Over 71% of all oil was produced in Washington County in Southwestern Pennsylvania, while other counties in the western part of the state made up the rest of the production. Washington County also accounts for 94% of all condensate produced from the state’s unconventional wells.
FracTracker wanted to see if there were any liquid production trends when we sorted the data by operator. Of the 1,146 active wells on the report in Washington County, 769 (67%) are operated by Range Resources Appalachia, LLC. Their wells produced 1,955,302 barrels (97%) of the condensate in the county, meaning that the remaining 377 wells from other operators produced a combined 50,915 barrels of condensate.
At first, it seems a bit anomalous that all of the other producers in the county should have such low a total for condensate. Some of this is likely attributable to defining the difference between condensate and oil. The way the data are presented, it seems as if they are two separate liquid hydrocarbon products. However, the difference really amounts to the liquid’s density, with heavier, thicker fluids considered to be oil, while condensates occupy the lighter, less viscous end of the spectrum. Condensate is also legal to export, while crude oil is not.
With this in mind, when we look at the liquid production in Washington County over the six month period, it seems likely that what Range Resources considered to be condensate was classified as oil by Chesapeake. The complete lack of liquid hydrocarbon production by any of the 259 wells operated by CNX, Rice, or EQT in the county does seem curious at first, but none of the three operators are active in any of the six municipalities reporting 100,000 or more barrels of liquids. Unconventional liquid hydrocarbon production in Washington County – and PA for that matter – is limited geographically, with the highest returns limited to a handful of municipalities close to the northern panhandle of West Virginia.
Unconventional wells reporting liquid production in Washington County from July to December 2014. Among unconventional wells in Pennsylvania, those in Washington County accounts for over 71% of oil production and 94% of condensate production.
Altogether, there are 2,351 wells on the production report that are listed as spudded but are not producing any of the three commodity types. The report includes a section for operators to explain why there is no production, as well as data about the well’s status. The reason that the majority of these wells are not producing are relatively straightforward; they are either plugged, have an inactive status, are not yet complete, or are shut-in, awaiting a pipeline connection.
In prior discussions with PADEP, active wells were described to us as those that had been spudded and not yet permanently plugged. There are also some conditions that can put the well into an inactive status at the operator’s request, for up to five years.
Still, there are a number of active wells that don’t fall into any of these categories, leaving us with no clear idea as to why they are not producing. The 10 operators with with the most active wells not in production – excluding observation, incomplete, and shut-in wells – are listed in Figure 5: Chevron, Chief, Southwestern, Cabot, and Anadarko.
Included in the statewide totals are three wells listed as having the incorrect operator, 32 wells where the reason for no production is listed as “Plugged well” but the well status is active, and 339 wells with active statuses where the reason for no production was left blank. Two operators, Chevron Appalachia and Chief Oil & Gas, account for 46% of these wells where the reason for non-production is uncertain.