American Oil and Gas Reporter - November 2015 - 94

SpecialReport: Marcellus/Utica Activity
"We are very excited about the deep,
dry gas Utica," expressed Craig Neal, vice
president of operations for CONSOL Energy, in October. "We have seven horizontal wells in various stages of completion."
CONSOL, which celebrated 150 years
in the Appalachian Basin in 2014, completed the Gaut 4IH well, its first deep dry
gas Utica well, in Westmoreland County,
Pa., in the second quarter with a 5,840-foot
lateral and a total measured depth greater
than 20,000 feet.
According to Neal, the Gaut 4IH well
had a 24-hour flow test to sales of 61.4 million cubic feet at an average flowing
casing pressure of 7,968 psig. He claims
the strong pressure and flow data bode well
for production and EUR. With the well
temporarily shut in while permanent production equipment was installed, surface
casing pressure increased to nearly 10,000
psig.
The Gaut 4IH well was drilled off the
Gaut pad, which includes seven Marcellus wells, Neal reports. CONSOL has
530,000 acres that overlay its Utica potential, stretching from Monroe County,
Oh., to the West Virginia panhandle and
southwestern Pennsylvania, he adds.
The company holds a 100 percent
ownership share in all of it, Neal indicates.
"We have 110,000 acres in Westmoreland
County alone, so we have plenty of opportunities," he ponders.

Deep, Dry Gas
CONSOL has drilled and fractured four
deep Utica dry gas wells in Monroe
County, Oh., and was in the process of
bringing them on line, Neal said in early
October. He said he expected the
Moundsville 6H well, drilled by its 50/50
joint venture partner Noble Energy in Marshall County, W.V., to come on line during the fourth quarter.
CONSOL's seventh deep, dry gas Utica well, the GH9 in Greene County, Pa.,
has a 6,000-foot lateral and is slightly shy
of 20,000 feet total measured depth. He
says it will be stimulated late in the
fourth quarter or in early 2016. The GH9
well, of which CONSOL owns 100 percent, sits only four miles from EQT's
Scotts Run well, Neal notes, which had a
24-hour initial production of 72.9 MMcf/d.
"When we get the seven wells into production, we will pause to give us time to
understand the production," he says, acknowledging the challenge companies
face in developing deep, expensive wells
in a lackluster commodity price environment. "We have a lot of blocked-up
acreage adjacent to these seven wells,
many of which we own 100 percent."
And those deep Utica wells certainly
do not come cheap. Neal says CONSOL
has spent $27 million at the Gaut 4IH well,
including drilling, completion and laid
pipe, but he predicts the company will

CONSOL Energy has drilled and completed four deep Utica dry gas wells in Monroe
County, Oh., and seven deep dry gas Utica wells in Greene County, Pa. The company
indicates it is comparing and contrasting the results it gets from various proppant types
in the Monroe County wells.

94 THE AMERICAN OIL & GAS REPORTER

bring costs down to $12 million a well in
Pennsylvania-where wells project to average 13,000 feet true vertical depth-and
push them down to $10 million in Monroe County, Oh., where the wells are not
quite as deep.
"The Marcellus is heavily explored, so
there is a lot of well control," he offers.
"Because of the Utica's depth, we don't
have as much experience. The learning
curve is very expensive. But we are gaining that experience. Costs for the fifth well
we drilled in Monroe County are drastically lower than the first well."
CONSOL also is conducting an interlateral proppant test on the Switz 6 pad in
Monroe County, Neal reveals. CONSOL
is stimulating one lateral with ceramic
proppant, another with resin-coated proppant and still another with white sand.
"If white sand will produce the same
results, that will move us a long way toward reducing costs," he explains.
Key Projects
Although prices have prompted companies to redirect their capital expenditures,
Neal assesses, it takes at least a year for
production numbers to reflect that lag.
Moreover, efficiency continues to improve.
According to Director of Communications
Brian Aiello, CONSOL started the year
with a $1 billion exploration and production budget and a goal of 30 percent
growth. "We have reduced our capital expenditures to $800 million, but we are projecting 39 percent growth in production in
2015," he touts.
Neal says CONSOL still has Marcellus wells drilled that are not fractured that
it can bring into production to optimize
cash flow. "We are weighing all options," he states. "We are likely to replace
some Marcellus drilling prospects with dry
Utica wells. We will put our money
where the best return for our investment
is. We have some highly attractive Marcellus acreage, but the Utica will compete
for those dollars."
Neal also points to a number of pipeline
projects in the Northeast as a consideration. "I predict that in the next couple
years, we will see a recovery in Northeast
(natural gas) pricing," he continues. "We
monitor very closely the market to which
we send our gas to in order to get the best
price."
In late 2014, CONSOL began work on
its first natural gas well pad at the Pittsburgh International Airport. Neal says one
pad has been drilled and the company ex-

American Oil and Gas Reporter - November 2015

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