shale plays future
TRANSCRIPT
The Shale Powered Future
Josh Hickman, PG, MSc, MBA
Hickman Geological Consulting, LLC
304-952-9397
Introductions
Josh Hickman
304-952-9397
Specialize in the space between technical oil and gas information and the financial
world.
Guide decisions for capital investments
Value oil and gas mineral estates
Develop business opportunities for companies lacking deep connections in
the industry
What is Shale?Marcellus Shale in Outcrop
Shale is:
• Sedimentary rock• Made from “mud”• Breaks easily• Laminated
Organic Shale is:
• Source Rock• Now considered a reservoir• Produces 8X the hydrocarbon it can hold• Termed an Unconventional Resource
Martian Shale in Outcrop
NASA
Facts on Organic Shale
Organic Shale in Core
• Up to 16% is left over carbon• Porosity is formed as organics convert to hydrocarbons
• Must be hydraulically fractured to produce
• 1/5 of gas produced in the US now comes from the Marcellus Shale
• Every other month the Appalachian Basin is producing more gas than it produced in 100+ years
Production Numbers
BCFVOLUME
‘Billion’ – 1,000MMCF
Production Numbers – Explained
Welcome back to school!
MCFVOLUME
‘Thousand’ Amount of natural gas that occupies
1,000 cubic feet at 60°F and a pressure of 15lbs
BTUENERGY
Amount of heat required to raise the temperature of one pound of water 1°F
MMCFVOLUME
‘Million’ – 1,000MCF
MMBTUENERGY
Amount of heat required to raise the temperature of one pound of water 1°F a
million times Avoiding the MATH…1 MCF generates 127 kWh
1BCF generates 127,000,000 kWh
Production Numbers – Related
Welcome back to school!
New York CityAnnual power consumption
of 60,000 gigawatt-hours
Average Utica Well will Produce 25 BCF over its 30
year life
That is 60,000,000,000 kWh!
That is 3,175,000,000 kWHfor every Utica Shale Well
drilled
That means that it would take ~19 Utica Shale Wells to
generate enough energy to power NYC for one year!
To date, 1,386 wells have been drilled in Ohio as of 3/7/15
Daily production in the Utica Shale is ~2 BCF/d or 254,000,000 kWh
It takes 164,383,562 kWh to power NYC every day…
That is 1.5X the daily need!
Shale Basins Across North America
Shale Basins Across the World
Food for Thought
Knowing this supply exists, you can draw your own conclusions as to why coal, oil, and natural gas prices have
plummeted.
Likely your conclusion will have nothing to do with Russia or Saudi
Arabia
A Few Historical Shorts
Where have we been with drilling and production in the past?
Video 1
A Few Historical Shorts
Where have we been with drilling and production in the past?
Video 2
Views from Around Pennsylvania 1900-1910
Views from Around Pennsylvania 1900-1910
14
Taylorstown - 1903
Oil City - 1899Thorn Creek - 1886
Early Oil FieldGas Venting
The Modern Well
15
Drilled in three stages• Site Construction• Drilling• Hydraulic Fracturing
Fast Facts• ~400 people are employed at various
stages by each rig• Shale wells cost between $6M and $12M
depending on depth• Conception to Production takes ~ 1 year
Rig Count in US12/14 = 1882 3/15 = 1192 ∆ = -690
The Modern Well
16
Video 3
Hydraulic Fracturing
17
A few fast facts to set the stage:• Used over a million times over the past 60
years in oil and gas applications• Not just used for oil and gas
• Water Wells• Geothermal• Remediation tool for Superfund Sites
• 99% of Frac fluid is sand and water• ~1% is composed mainly of guar, a common
ingredient in candy and ice cream, that is an emulsifying agent
• The rest are products to break water tension and allow as much water as possible to flow back out of the well
Hydraulic Fracturing
18
Video 4
Production
19
Images Courtesy of Marcellus Air WV
Questions?
Josh Hickman
304-952-9397
Specialize in the space between technical oil and gas information and the financial
world.
Guide decisions for capital investments
Value oil and gas mineral estates
Develop business opportunities for companies lacking deep connections in
the industry