Magnum Hunter Resources Corp (NYSE:MHR)
Next up is Magnum Hunter Resources Corp (NYSE:MHR), a Houston-based energy explorer and producer. In February, the company closed on the acquisition of about 15,500 gross leasehold acres located primarily in Noble County, Ohio, through Triad Hunter, its wholly owned subsidiary. That brings Magnum Hunter Resources’ total position in the Utica shale to a little over 61,000 net acres.
The company has announced plans to drill at least four Utica test wells in Ohio this year. If results are encouraging, it will develop its leasehold position further later this year. The company is currently constructing its first pad in Washington County, Ohio, that will probably be used to drill the four horizontal wells.
Gary C. Evans, Magnum Hunter’s CEO, expressed his enthusiasm about the company’s position in the Utica, saying, “The Utica Shale of Ohio will be a major focal point for our company this year as we prepare to drill our first well in this exciting new resource play.” Depending on the results of its test wells, the Utica may prove crucial in helping the company increase production and cash flow, while reducing its uncomfortable level of debt.
Gulfport Energy Corporation (NASDAQ:GPOR)
Last but not least is Gulfport Energy Corporation (NASDAQ:GPOR). Most recently, the company announced that it will purchase roughly 22,000 acres in the eastern Ohio portion of the play from Windsor Ohio, an affiliate of Wexford Capital, a Connecticut-based investment manager focused on energy and natural resources. This most recent purchase, announced last month, will bring Gulfport Energy Corporation (NASDAQ:GPOR)’s total acreage in the Utica to around 128,000 acres, making it one of the dominant names in the play.
Encouraged by impressive initial results, Gulfport Energy Corporation (NASDAQ:GPOR) CEO James Palm touted the Utica as having “exceptional potential.” Not surprisingly, the company plans to allocate the vast majority of its capital budget for 2013 toward its operations in the play. It plans to drill roughly 50 gross wells this year, many of which will be situated on pads adjacent to existing wells.
Final thoughts
Going forward, these and other companies’ enthusiasm about the Utica may be partially vindicated by production data scheduled to come out shortly. One of the major reasons there’s such a paucity of data for the Utica is that Ohio reports production statistics only annually, as opposed to quarterly as most other states do.
Well, the Ohio Department of Natural Resources will release that annual data next month, which should provide investors with a meaningful glimpse into the play’s potential. The DNR report will include data on between 50 and 60 wells drilled in Ohio’s Utica last year, including each well’s output, its location, and its operator.
These statistics should offer a better understanding of where some of the most productive zones lie and which companies have managed to secure the most promising acreage. For those interested in this data, be sure to check it out next month on the Ohio DNR website.
The article 3 Companies Betting Big on This Emerging Shale Play originally appeared on Fool.com.
Fool contributor Arjun Sreekumar has no position in any stocks mentioned. The Motley Fool recommends Total and has options on Chesapeake Energy.
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