Halcon re-evaluates drilling in region's Utica shale
Texas-based Halcon Resources Corp. is awaiting results of two wells in the Utica Shale play in eastern Ohio and western Pennsylvania before deciding whether to continue drilling in the region.
Until it gets more results, the company is turning its attention to other areas.
“We don’t have any plans to move a rig in there [Utica] at this time,” Floyd C. Wilson, chairman and CEO of Halcon said last week during Halcon Resources’ fourth-quarter and full-year 2013 earnings conference call.
“We’ve got a well flowing back and a well resting. And we’re going to just wait and see what the results are there,” he said. “They haven’t been too wonderful in the far north part of the play, and we’re just going to see how we come out with these couple of new wells. It’s no part of our spending for this year at this moment, and it’s no part of our production expectations ... for this year at this moment.”
The company has three producing wells in Trumbull County, where one additional well has been drilled, one is being drilled and three have been permitted. In Mahoning County, it has one producing Utica well in Jackson Township with two additional wells permitted.
It also has drilled wells in western Pennsylvania in Mercer, Venango and Crawford counties.
Halcon has leased about 139,000 acres in Ohio and Pennsylvania, according to a report in the Akron Beacon Journal.
On the heels of last week’s announcement of a de-emphasizing of the region for the immediate future, the company announced Tuesday, “We are in the process of drilling and completing two new wells with 100 percent slick water frac designs and plan to flow test these wells by the end of the first quarter of 2014, and the results from these two wells are expected to determine future drilling plans in the play.”
The company announced last week that it had acquired 307,000 acres in the Tuscaloosa Marine Shale in Louisiana and Mississippi, where it will now transition its focus.
The company reported poor results in its Northeast Ohio and northwest Pennsylvania acreage during the latter half of 2013, and its stock is underperforming industry peers.
Halcon announced last summer its plans for a $70 million fuel depot at the Ohio Commerce Center in Lordstown.
The facility would be used to store and distribute oil produced across the Utica Shale play to both the East Coast and Gulf Coast.
The facility was approved during a July 2013 meeting of the village’s board of zoning appeals. Construction was expected to create 50 jobs for one year, and 30 full-time jobs will be required to staff the depot.
Halcon has 11 drilling permits here and 22 in Pennsylvania, which is a relatively small holding when compared with other companies with hundreds of permits.