Ohio Begins to Tap the Utica Shale

From the US Energy Information Agency;

Escalating industry interest in the Utica Shale, which lies under the more familiar Marcellus shale and covers a wider geographic area, may boost Ohio into the ranks of U.S. States with significant increases in oil and natural gas production from horizontal drilling in shale formations. Although production volumes are still small, the number of Utica-targeted horizontal drilling permits issued to Ohio operators from January through September 2011 rose more than twenty-fold over full-year 2010.

In eastern Ohio, the Utica is thought to be relatively rich in oil and natural gas liquids that are currently worth significantly more than natural gas on an energy-equivalent basis. Preliminary estimates by Ohio's Department of Natural Resources (ODNR) suggest a recoverable reserve potential of between 1.3 and 5.5 billion barrels of oil as well as 3.8 to 15.7 trillion cubic feet of natural gas. Industry interest in the Utica is already apparent: from January through September 2011, ODNR issued a total of 42 permits for drilling horizontal wells in Ohio's portion of the Utica Shale. In sharp contrast, only 2 such permits were issued in all of 2010.

Yesterday I did a post on the beginning of the revitalization of Youngstown's steel industry driven by the demand for drilling pipe for the Pennsylvania's Marcellus Shale gas field. Ohio's very promising future lies with the development of the lesser know Utica Shale formation which lies under the better know Marcellus. If I had to pick winners in the industrial midwest I would choose Ohio and Pennsylvania because both have the potential to be in the top 10 of energy producing states in the foreseeable future. Potential resources are not enough. Political leadership is essential to bring the upcoming manufacturing renaissance into fruition. Cheap and plentiful energy is essential to a manufacturing base good enough to compete in the global market. The US lacks only the political will to achieve an industrial dominance that will astound the world; something not seen since the sixties. While I'm reluctant to endorse any candidate at this time in the Republican primary I will say the midwest could do a lot worse than Rick Perry if for no other reason than he understands energy.