BP has leased 84,000 acres of land in the Utica/Point Pleasant shale formation in northeast Ohio for oil and gas production. Financial terms of the deal with the Associated Landowners of the Ohio Valley were not disclosed.
With much talk going around about Marcellus Shale drilling, civilians might be wondering the importance of the Utica Shale and how it is related. The Utica Shale is a rock unit located a few thousand feet below the Marcellus Shale (and is thicker than the Marcellus) and many oil companies have drilled. It has potential to become a huge resource for natural gas.
Ohio is hitting it big with shale related deals this month as Chesapeake Energy Corporation recently announced a $900 million project for gathering, compression and processing of natural gas and natural gas liquids.
“We actually think this has the opportunity to be very good for Ohio, very good for BP,” said Tim Harrington, regional president of BP North America Gas. “One of the things that we quite like was the potential for the liquids-rich gas opportunity,” he said.
BP was driven to the shale because it offers dry gas and wet gas as well as heavier liquid gas. The company will sign up leaseholders over the next 6 months, then appraise how much oil and gas are in the shale.
BP actively drills across Texas, Oklahoma, and Arkansas.