1. Ohio Oil and Gas Update — Kristy Hawthorne OOGA

Oil & Gas Business Educational D evelopment Seminar Apr il 11, 2011

Oilpatch Snapshot

Ohio Oil & Gas I ndustr y Industry in Ohio for 150 years 275,774 oil and gas wells drilled 64,378 wells in production

Production Cr ude Oil

N atur al Gas

2011 4,852,964 barrels

2011 73,289,838 mcf

T otal 1,141,380,706 barrels

T otal 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 D r illed by County 460 total w ells County I nfor mation Stark – 40 Mahoning - 21 Tuscarawas - 18 Carroll - 15 Portage - 14 Summit – 11 Major targeted reservoirs Clinton/ Beekmantown

≥ 20 wells

< 20 wells

What does Shale mean to Ohio’s Economy?

Ohio Oil & Gas Ener gy Education Pr ogr am www.oogeep.org

Economic I mpact Study Released September 2011

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.

• Distribute $1.6 billion in royalty payments

I tâ&#x20AC;&#x2122;s not the str ongest of the speci es tha t sur vi ves, not the most i ntel l i gent, but the ones most r esponsi ve to cha nge â&#x20AC;&#x201C; Cha r l es D a r wi n

Pr edr illing Supply Chain Access (Lease) Road

Fresh Water Impoundment

Well pad

Pipeline access

Sour ce: M ar cellus Shale Education and T r aining Center Š M SET C, 2012

Supply Chain Oppor tunities D r illing D ow n

Pr e-D r illing • • • •

Construction Aggregates Surveying Fencing

• Equipment Rental • Environmental • Engineering

T imefr ame Up to 2 months

Drilling & Well Construction Crown Block

Derrick

Monkey Board

Traveling Block/ Top Drive Triple Standing Drill Pipe

Dog House

Sour ce: M ar cellus Shale Education and T r aining Cent er Š M SET C, 2012

Supply Chain Oppor tunities D r illing D ow n

D r illing and Well • Fuel • Trucks, Trucks uction Constr and more Trucks • Equipment rental • Water • Security

• Aggregates • Maintenance/ repair parts • Housing/ hospitality

T imefr ame 2-4 months

Completion Supply Chain Courtesy: Range Resources Appalachia

Sand Storage

Water Impoundment

Acid Truck Goat head Staging Area

Blender Trucks Control Center

Chemical Storage

Pump Trucks Water Transfer Tanks High Pressure Water Transfer Manifold Lines Sour ce: M ar cellus Shale Educat ion and T r aining Center Š M SET C, 2012

Sand Haulers

Supply Chain Oppor tunities D r illing D ow n

Completion/M idstr • Water, Water • Site Restoration andeam more Water • Meters/ monitoring • Refining • Product sales

• • • •

Pipeline Welding supply Compressors ROW Work

T imefr ame 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

MarkWest – Harrison & Monroe Counties $500 million and 700+ construction jobs

Timken, Canton $225 Million

Exterran – Columbiana County $13 million and about 100 jobs

Chesapeake Energy, M3 Midstream, & EV Energy Partners, Columbiana County $900 million

Baker Hughes – Stark County $64 million and 700 jobs

Halliburton – Muskingum County $150 million and 300 jobs

Select Energy Services – Carroll County $10 million and 185 jobs

$2.75 BILLION and Counting – NOT Including Lease and Royalty Payments, Operations, etc.

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Business D evelopme nt 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 The Ohio Oil & Gas Association (OOGA) is a trade association with over 2,300 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