Oil & Gas Business Educational Development Seminar June 15, 2012
Oilpatch Snapshot
Ohio Oil & Gas Industry Industry in Ohio for 152 years 275,774 oil and gas wells drilled 64,378 wells in production
Production Crude Oil
Natural Gas
2011 4,852,964 barrels
2011 73,289,838 mcf
Total 1,141,380,706 barrels
Total 8,593,388,085 mcf
Production numbers estimated based on available data, compiled by OOGA, oil reserve, gas reserve and the Department of Energy
2011 Wells Drilled by County
460 total wells 58 Utica Wells Drilled 7 Wells in Production As of March 15, 2012 161 Utica Wells Permitted ≼ 20 wells
< 20 wells
What does Shale mean to Ohio’s Economy?
Ohio Oil & Gas Energy Education Program
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www.oogeep.org
Economic Impact Study Released September 2011
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2010 $988 million in gross state product $1.7 billion statewide output or sales 2011-2014 Oil and gas producers are projected to reinvest over $34 billion in exploration and development, midstream, royalty and lease expenditures. Could generate approximately $12.3 billion to the gross state product and have a statewide output or sales of $23 billion.
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Distribute $1.6 billion in royalty payments
Itâ&#x20AC;&#x2122;s not the strongest of the species that survives, not the most intelligent, but the ones most responsive to change â&#x20AC;&#x201C; Charles Darwin
Predrilling Predrilling Supply Supply Chain Chain Access (Lease) Road
Fresh Water Impoundment
Well pad
Pipeline access
Source: Marcellus Shale Education and Training Center Š MSETC, 2012
Supply Supply Chain Chain Opportunities Opportunities Pre-Drilling
Drilling DrillingDown Down • • • •
Construction Aggregates Surveying Fencing
• Equipment Rental • Environmental • Engineering
Timeframe Up to 2 months
Drilling Drilling & & Well Well Construction Construction Crown Block
Derrick
Monkey Board
Traveling Block/ Top Drive Triple Standing Drill Pipe Dog House
Source: Marcellus Shale Education and Training Center Š MSETC, 2012
Supply Supply Chain Chain Opportunities Opportunities Drilling DrillingDown Down
Drilling and Well • Fuel Trucks, Trucks Construction
• and more Trucks • Equipment rental • Water • Security
• Aggregates • Maintenance/ repair parts • Housing/ hospitality
Timeframe 2-4 months
Completion Supply Chain Courtesy: Range Resources Appalachia
Sand Storage
Water Impoundment Goat head
Acid Truck Staging Area
Blender Trucks Chemical Storage
Control Center
Pump Trucks Water Transfer Tanks High Pressure Water Transfer Manifold Lines Source: Marcellus Shale Education and Training Center Š MSETC, 2012
Sand Haulers
Supply Supply Chain Chain Opportunities Opportunities Drilling DrillingDown Down
Completion/Mid-stream • Water, Water and more Water • Meters/ monitoring • Refining • Product sales
• • • • •
Site Restoration Pipeline Welding supply Compressors ROW Work
Timeframe
Completion work: 2 months up Production: up to 60 Years
Recent Industrial Investments in Utica Shale V&M Star – Youngstown $650 Million + U.S. Steel, Lorain $240 Million Timken, Canton $225 Million Chesapeake Energy, M3 Midstream, & EV Energy Partners, Columbiana County $900 million Halliburton – Muskingum County $150 million and 300 jobs
MarkWest – Harrison & Monroe Counties $500 million and 700+ construction jobs Exterran – Columbiana County $13 million and about 100 jobs Baker Hughes – Stark County $64 million and 700 jobs Select Energy Services – Carroll County $10 million and 185 jobs
$2.75 BILLION and Counting – NOT Including Lease and Royalty Payments, Operations, etc. 15
Business Development Seminar Goals
• Overview of how the industry procurement process works • Opportunities within the supply chain • Tools to build a business plan to enter the oil and gas industry – – – –
Safety expectations Insurance requirements Contracts Marketing ideas
Ohio Oil and Gas Association Mission:
To protect, promote, foster and advance the common interests of those engaged in all aspects of the oil and gas production industry The Association advocates for the industry before the Ohio General Assembly, United States Congress, state and federal agencies and the general public.
Ohio Oil and Gas Association OOGA contributes to members business and professional growth by offering a wide range of services, programs, products and money saving opportunities. Activities are focused in four areas: • Advocacy on a state and national level • Information sharing through monthly newsletter, website, email alerts and report services • Educational opportunities through industry specific training and information sharing seminars • Economical programs to ensure compliance with state and federal regulations.
Ohio Oil and Gas Association The Ohio Oil & Gas Association (OOGA) is a trade association with over 2,600 members involved in the exploration, production and development of crude oil and natural gas resources within the State of Ohio.
Kristy Hawthorne Director of Membership Services and Small Business Development
khawthorne@ooga.org 740-587-0444
www.ooga.org