In Pennsylvania, the vast majority of unconventional oil and gas activity is focused on the Marcellus Shale formation, a Devonian period deposit of black shale with a high hydrocarbon content, which requires horizontal drilling and large scale hydraulic fracturing to produce enough oil and gas to make the drilling economically viable. This formation was created about 390 million years ago, when organic-rich deposits accumulated in what is now the Appalachian Mountains, but was at that time a shallow sea. Down below the base of the Marcellus lies the Utica Shale, an Ordovician period formation, with almost the same geographic extent as the Marcellus, but the deposits were placed there about 65 million years earlier.
Utica permits and violations in Pennsylvania. Click here to access the legend and other map tools.
In neighboring Ohio, it is the Utica that gets most of the attention, with 937 permitted wells, as opposed to just 20 for the Marcellus. In Pennsylvania, the reverse is true: there are 16,110 permitted Marcellus wells, but only 279 permits for Utica wells. Part of the reason for this is because the subsurface characteristics of these formations vary widely, especially in terms of thickness and depth. With changes in depth come changes in temperature and pressure, which are key criteria in hydrocarbon formation. In other words, the same formation that produces considerable quantities of gas and valuable liquid hydrocarbons in eastern Ohio may be economically unviable just a county or two over in western Pennsylvania.
Utica drilling permits have been issued in 19 different counties in Pennsylvania, with wells having been drilled in 15 of those. The violations per well (VpW) score for Utica wells in the Keystone State is 0.9, meaning that there are nine violations issued for every 10 wells that have been drilled. It is worth noting, however, that only 36 of the 114 drilled wells have received violations, meaning that some wells have been cited on multiple occasions.
Of particular note is Bradford county, the site of only one Utica well, but 19 items on the compliance report. The problematic Bayles 1 well was run by three different operators before being permanently plugged. This well also has two “Drill Deeper” permits, and as a result, it is likely that the first six violations assessed to this well were issued before it was associated with the Utica Shale, as they precede the most recent spud date for the well in June, 2005. Most of the violations for this well seem to be for pit violations and discharges to the ground and nearby stream.
In terms of drilling activity, it appears to have peaked in 2012, calling into question whether the industry considers the formation to be economically viable in Pennsylvania. Of the 28 wells drilled since the beginning of 2014, Tioga County has seen the most activity with 11 wells drilled, followed by five wells in Butler County, then three in Lawrence County. If we think of drilling activity as a sort of positive feedback from the industry – meaning that they like what they see and want to keep exploring – then only Tioga County seems to be holding the attention of the various operators who have been active in the Utica Shale. Given the Utica activity in Ohio, one might have thought that counties on the western edge of the state – especially Beaver, Lawrence, and Mercer – would have shown the most promise, but this appears not to be the case.