Recent Horizontal Drilling Oil & Gas Plays in the Appalachian Basin: A Quick Overview

Recent Horizontal Drilling Oil & Gas Plays in the Appalachian Basin: A Quick Overview

The success of shale gas & oil is a result of horizontal drilling and high-volume hydraulic fracturing. In the Appalachian Basin the two big plays are the Marcellus and the Utica. In addition to those plays there are others with much less in reserves but some have been shown to have good economics even at moderate commodities prices. Others are newer and still being evaluated. Each seems to be somewhat unique in costs, technical requirements, and type of completion. Some may not need to be fracked to be economic. Other possibilities and reservoirs may exist in addition to these. These plays include unconventional shale reservoirs (Burket, Rhinestreet/Middlesex, Lower Huron, Upper Marcellus, and Rogersville) and conventional reservoirs (Berea, Clinton, Trenton-Black River, and Knox). 

Upper Devonian Burket (Geneseo) Shale

This play is now well established and is being successfully developed in tandem with Marcellus and Utica wells, sharing well pads and infrastructure to reduce cost. In some of the most active parts of the play the Burkett is only a couple hundred feet above the Marcellus but in the eastern areas it is well over a thousand feet above it. It is thought to be best developed in tandem with the Marcellus rather than later due to a pressure sink above Marcellus that would possibly drop pressure over time and make the Burket harder to maintain pressure to produce if it were to be produced later. Reserves in the play are less than the Marcellus – maybe two-thirds or three-quarters as a ballpark figure, maybe more in some areas. The play has been most economical in the trend where there are significant natural gas liquids. The best part of the play so far has been in southwest and far west Pennsylvania. Other areas: northern West Virginia, north-central Pennsylvania and northeastern Pennsylvania are also prospective to varying degrees. There have recently been some good wells in Lycoming County. The area in north-central PA is still largely unexplored for Burket. It is a dry gas area. Where it is productive in the far western parts of PA the Burket is thin. Fortunately the geology is mild in this area with little structure so that thinner zones can be optimally accessed through geosteering, as it is easier to stay in zone with no structure. The biggest early producing wells in the southwest area have been in Greene and Washington Counties, followed by western Butler County, and more recently in eastern Beaver County where it is shallowest and liquids-rich. The play also extends well into north central and northwestern West Virginia with about eight counties considered prospective.

Upper Devonian Rhinestreet (and Middlesex) Shale

This play has had a few wells. It will likely be developed with higher gas prices. Some natural gas liquids are also likely for this play which will likely enhance its economic potential. The play is most prospective in the northwest corner of Pennsylvania, possibly far Western New York, and along the Ohio River in northern West Virginia. Northwest PA is the most prospective due to thickness of reservoir, reservoir pressure, and possibility of sharing pads and infrastructure with Burket and Marcellus. Several Rhinestreet wells have been planned and permitted though few have been drilled. REX Energy, Consol, and EQT have all planned to evaluate the zone. One well was productive in Ohio early on but sub-economic and likely combined with other shales as the zones thin and coalesce there. EURs have yet to be established but are thought to be lower than Burket and significantly lower than Marcellus. Rhinestreet should share the overpressured status of the Burket and Marcellus through most areas in the north, though a pressure boundary may exist – probably above it. There are two main zones in the Rhinestreet that have high gamma and typical gas shows. There is also the Middlesex “hot” Shale below the Rhinestreet that may be productive as well. One problem is that these zones are generally thin and stratigraphically spaced apart so that separate laterals would be required to access each zone which is not likely to happen unless gas prices are much higher than at present.

Upper Marcellus Shale

In Northeastern Pennsylvania where the Marcellus is generally between 150 and 300 ft thick there have been some tests specifically of the upper zone - above the Cherry Valley Limestone. Since the Cherry Valley is thick in the area it is thought to be a very good frack barrier to keep the commonly drilled Lower Marcellus fracks contained below. Recent IPs in the Upper Marcellus have ranged up to 18MMCFD. For reserves purposes this means this area will be a workhorse for gas wells for many years to come, especially after pipeline bottlenecks are eliminated and LNG is developed.

Upper Devonian Lower Huron Shale

Many horizontal wells have been drilled in West Virginia and Kentucky in this predominantly gas play with higher gas prices required for more widespread development. There have been a few wells with oil and oil may be a future possibility in some areas. A few tests have been drilled in Ohio with sub-economic results. Typically these wells were produced without running casing – by the packer plus method of fracking, to reduce costs. EQT was the main player in Kentucky and Southern West Virginia and probably has fracked through casing as well. They consider the wells prospective at higher prices. Lower Huron plays have lower gas-in-place and significantly lower reservoir pressures than the Middle Devonian reservoirs in the areas where they produce. If gas prices rise enough EQT and other operators may resume the play.

Upper Devonian/Lower Mississippian Berea Sandstone 

The Berea Oil Play in Kentucky has been economic for several reasons: shallow depths (less than 2000ft), adequate pressure, fracking and production through casing, and local access to refineries. The play has also been produced economically from fluvial reservoirs in West Virginia and there is some potential in Ohio. This play began in 2011 and took off in 2013 and 2014 with several areas tested and several operators active. Production is mainly from a tight Berea Sandstone/Siltstone with low permeability that is enhanced with horizontal drilling and fracking. Horizontal drilling likely encounters and links up more of the natural fractures and compartmentalized reservoirs. Thermal maturity trends are based on the source rock – likely Devonian Lower Huron and other shales below the reservoir. Trapping is stratigraphic with some likely structural enhancement. The play was virtually non-existent as a vertical play due to the low permeability. The play has declined recently due to the low oil price but would likely be revived with significant oil price increases. A handful of counties in Eastern Kentucky are prospective and a few counties in West Virginia, where reservoir quality is optimized. Virginia and Southern West Virginia may also be a possible where there are significant Berea fields but those would be dry gas.

     

Mississippian Big Injun & Weir Sandstones, and Big Lime (Limestone)

This play has produced oil in Central West Virginia in wells drilled by Cunningham Energy. The best wells are thought to be in the Big Injun zone which typically has very good porosity. Cunningham Energy notes on their website that they expect to drill 200,000 horizontal feet in 2015. Their acreage is concentrated in Kanawha and Clay Counties. Historically, Kanawha County has been one of the most productive oil counties in West Virginia. These plays may be over-hyped as actual reported production so far has been low and seems sub-economic. It depends on cost and oil prices as well as rates and reserves so time will tell. There may have been some tests in Mississippian Big Lime/Newman Limestone as well.

    

Silurian Clinton Sandstone

This play has had marginal success in Ohio with both oil and gas production. EV Energy partners has drilled wells in the East Canton Oil Field in Stark County, Ohio and Energy Cooperative has drilled one well in Coshocton County, Ohio in the play. Preliminary wells suggested EURs in the East Canton oil field of about 150,000 Bbls of oil but that estimate may have been adjusted downward after longer production history. Well costs are in the range of $2-3.5 million but are thought to avg. around $2.5 million. Early wells have produced from short laterals. One well was drilled in the Cabot Head shale between two of the Clinton Sandstone bodies but was significantly less productive. Drilling the hard sandstone is generally slow compared to the fast drilling in shale. This could also add to costs in longer laterals. This play is probably economic at higher oil prices but not with current pricing. Continuity of porous sandstone bodies in this fluvial deltaic play could be an issue, especially in longer laterals. Oil and gas depletion could also be an issue as the play has been extensively drilled. Further east into Western Pennsylvania where the sandstone is tighter (and deeper) might someday be tested as virgin reservoir pressure and undepleted reserves could be present and producible. 

More recently Enervest noted at the winter meeting of the Ohio Oil and Gas Association update that they were satisfied with the Clinton horizontal economics with a higher oil price. They now have 7 producing Clinton horizontals with total production at about 1100 Bbls per day (I am not sure if that is actual production or combined IPs). They gave an avg. completed well cost of $1.8 million for a 2000 ft. lateral. However, they also noted frequent broken bits in the hard sandstone. Wells were drilled in avg. 20-25 days. Thus, there could probably be some improvement in the economics as some of the problems are worked out in time and laterals could perhaps get longer. Horizontal wells also have been drilled and more planned in Clinton Sandstone gas storage fields in northeastern Ohio. These wells are drilled not for production but to increase deliverability from the storage field. This is another potential source of information and understanding of drilling the Clinton horizontally.

Other Possible Silurian Plays: Another Silurian horizontal play being tested or in planning stages is the Corniferous Limestone in Kentucky, an unconformity pinchout play. I recall some permits in East-Central Kentucky but do not know any more. The Corniferous is at the Devonian-Silurian boundary. It is a carbonate formation. Cabot Oil & Gas drilled horizontal wells in the Silurian Keefer Sandstone just below this interval in the late 90's/early 2000's in Wayne County, West Virginia with some pretty decent results - BCF+ wells. The play was likened to the Austin Chalk where horizontal wells optimized encountering vertical fractures that vertical wells could not. Gas quality may have been an issue as the Corniferous zones are rich in H2S in some areas.

  

Ordovician Trenton-Black River

This zone was drilled horizontally in the late 90’s and early 2000’s mainly by Talisman Energy in Ontario, Canada. Vertical wells in New York and West Virginia showed high rates of production, when productive. It is a hydrothermal dolomite play where hot fluids moved through fractures (thought to be pressure cracks) that were sometimes associated with seismic sags. They were also called “dolomite chimneys.” There is some evidence that they may exist throughout the Appalachian Basin, in the Michigan Basin where there is some production, and in the Canadian part of the Appalachian Basin where there has been moderate production. If they are present in frequency then multiple “chimneys” could possibly be accessed through horizontal drilling. Chad Cunningham thinks that the high rates seen in Utica-Point Pleasant wells may be a result of the wells linking up with these high-pressure chimneys. His evidence includes unexpected gas kicks during drilling which took very high mud weights to kill, production that exceeds that gas-in-place calculated by examining reservoir parameters, pressure drawdown and decline curves that suggest a dual-porosity production system (fracture porosity in the TBR and organic porosity in the Utica-PP), XRD/XRF data that suggest hydrothermal dolomite as a possibility in best zones, and tracer data that show those zones with that XRD/XRF mineral data (high zinc, high halfnium, low arsenic) were contributing most of the production early on with other zones coming on later consistent with his dual-porosity model. His ideas should be able to be confirmed or denied with more data, including existing data. If it is true, he notes, it could revive vertical TBR testing or shorter-lateral, fewer frac stage horizontal testing, both of which would reduce well costs. The problem with vertical TBR wells was that there were dry holes: wells with decent seismic signatures that encountered no or little gas and in some cases water. Differences in production determined by whether a chimney(s) was encountered may also support the play concept. I think he mentioned some differences in resistivity readings and calculated water saturations between zones thought to be in contact with the vertically fractured hydrothermal chimneys and those not. In that respect utilizing a resistivity log with MWD might be fruitful. It could also aid geosteering.

    

Cambro-Ordovician Rose Run Sandstone/Dolomite and Cambrian Trempeleau Sandy Dolomite

This is a newer horizontal play being tested in the Knox Unconformity sequence. Techniques and strategies are being developed as the nature of the structures involve buried hills with horizontal wells potentially accessing multiple hills/remnants. Horizontal wells have recently been permitted for Trempeleau in Morrow County, Ohio within the historic field there, and possibly in Pickaway County, Ohio to test the Rose Run. Both of those areas are considered to be predominantly oil plays. The Morrow County well may be an attempt at secondary oil recovery.Vertical Knox wells (Rose Run, Beekmantown, and Trempeleau) are typically acidized but not hydraulically fractured. This would make well costs significantly lower. The key to economic production might be accessing multiple remnants with structural closure and greater reservoir access provided by horizontal drilling. Many of the existing wells in the play are thought to be from erosional remnant traps that are small in areal extent - in the range of 40-60 acres. Optimal borehole orientation or directional azimuth is likely to be similar to that of Marcellus and Utica due to similar stress directions but that has not yet been determined. More important for Knox horizontals would be the the areal configuration of the remnants and how far apart they are, so lateral direction would be less important.The Knox plays may be in the process of being revived through higher quality 3D seismic for both vertical wells and horizontal wells. The key to success is likely to be the low cost associated with no hydraulic fracturing and successfully hitting multiple remnants with structural closure. Maximizing the lateral continuity of the high porosity target within each remnant structure encountered is likely to be an issue. In that sense it may be like drilling two or more wells in one lateral. I am guessing these are planned to be produced open-hole which may be an issue for production as well.

    

Cambrian Rogersville Shale

This play is being evaluated mainly in Eastern Kentucky but also in Southwest West Virginia. The first announced results of a stratigraphic test in Lawrence County, KY by Bruin (a subsidiary of Cimarex ) have showed fairly disappointing rates (?? ~18 Bbls of Oil and a few hundred MCFD of gas ??). However they did decide to take the well horizontal which may increase rates. Chesapeake recently did hydraulic fracturing at its Lawrence County vertical test which was an into-the-trough far offset to the Inland White vertical well, an old well form Boyd County to the north that produced fair amounts of oil from the Marysville Limestone there on the high-side of the Rome Trough. Results are unknown. Cabot Oil & Gas drilled a vertical test in Putnam County, West Virginia with a total vertical depth of about 14,000 ft. The well is apparently producing dry gas but volumes and zone(s) are unknown. Other zones – particularly the Rome sands or carbonates or possibly the Marysville Lime and Nolichucky Shales are being tested in some of these wells. Ashland drilled a well in Johnson County in the 1970s or 80's that produced significant quantities of gas from fractured Nolichucky Shale. Chesapeake and EQT have also drilled recent vertical tests in Kentucky, Chesapeake in Lawrence County and EQT in Johnson County. EQT permitted a horizontal test which was drilled in late 2015. Cimarex (as Bruin) and Chesapeake permitted horizontal tests. Successful vertical wells in the late 1990’s in Homer Field in Elliott County produced from and had significant shows from several reservoirs: Cambrian Rome sands, Cambrian Conasauga Shale, St. Peter Sandstone, and Trenton-Black River Limestone. Source rocks for the Cambrian reservoirs are thought to be the Rogersville Shale which generally has the best TOC but could also be Ordovician Utica migrating from down-basin – the source for Cambro-Ordovician reservoirs in Ohio. However, the Inland White well oil fingerprint was a very good match to Rogersville so it is likely the source rock. It is still too early to tell if this will be a viable and consistent play but there is considerable interest with vigorous leasing over the last few years and even from Aubrey McClendon’s American Energy Partners. Marathon Oil which has a local refinery has predicted the possibility of significant investment since there is available infrastructure, NGL processing, and refinery capacity in the area. It is as yet quite unclear how the maturity trends might play out but there has been significant gas, condensate, and oil produced in the Kentucky Cambrian section which thickens by thousands of feet into the deeper parts of the Rome Trough. Ideal drilling azimuth directions have yet to be determined as well but mechanical properties logs and petrophysical data on the vertical wells should suggest fracture orientations and stress directions. 

 

References:

The Upper Devonian Burket/Geneseo Shale: Appalachia’s Little Brother to Utica & Marcellus – by Gregory Wrightstone, in Ohio Gas & Oil, May 14, 2015

Geology of the Berea Horizontal Oil Play, Eastern Kentucky – by Dave Harris, Kentucky Geological Survey, University of Kentucky, April 24, 2013

Rogersville Shale – A Brief Look at the History of a New Deep Play – by Junior Jenkins, presented at Appalachian Geological Society Meeting, Oct. 14, 2014

Southeastern Ohio Pt. Pleasant: A Shale Play? – by Chad Cunningham, presented at Appalachian Geological Society Meeting, Jan. 19, 2016

Development Opportunities in the Appalachian Basin - by Joe Morris, presented at Eastern Unconventional Oil & Gas Symposium, Nov. 5, 2014

Cambrian Rogersville Shale (Conasauga Group) in the Rome Trough, Kentucky and West Virginia: A Potential New Unconventional Reservoir in the Appalachian Basin – by David C. Harris, John B. Hickman, and Cortland F. Eble, presented at Eastern Unconventional Oil & Gas Symposium, Nov. 6, 2014

Driller’s Target Stark County’s Clinton Sandstone Formation – by Shane Hoover, in The Repository, Canton, Ohio, posted Sept. 7, 2014

Learning to Horizontally Drill a Depleted Clinton Sandstone Reservoir – by Greg Mason, presented at Ohio Oil & Gas Association Technical Conference and Oilfield Expo, Dec. 3, 2014

Horizontal Drilling {Berea} in Conventional Reservoirs – by Mark Lytle, presented at Ohio Oil & Gas Association Technical Conference and Oilfield Expo, Dec. 3, 2014

Rogersville Shale Secrets Exposed – Appalachia’s “Next Big Thing?” NGI Reports, Aug. 6, 2015

Common Hydrocarbon traps in the Rose Run Subcrop - by William Rik, presented at the 1992 Ohio Oil & Gas Association Winter Mtg.

Structural Evolution and Petroleum Potential of a Cambrian Intracratonic Rift System in Kentucky - by John Hickman, Ph.D., presented at Appalachian Geological Society Mtg., Feb. 16, 2016 

Enervest Happy With Clinton Sandstone Horizontal Wells in Ohio - article by Bob Downing, in Akron Beacon Journal (ohio.com), March 19, 2016