With the help of Gateway Royalty, Nancy Deucker received an upfront payment for her gas and oil royalties and used it to diversify her investment portfolio. Learn more about her story.
3 Questions Answered about Oil & Gas Activity in Guernsey County
Posted December 16, 2019
At Gateway Royalty, we always enjoy spending time in Guernsey County. As anyone who lives here knows, Guernsey is an incredibly unique and interesting place. The county is home to Salt Fork (the biggest state park in Ohio) and Seneca Lake (one of the state’s biggest lakes). National Road, a 620-mile highway built in the early 1800s connecting the Ohio and Potomac rivers, runs right through it. And in the fall the area hosts The Official Paul Bunyan Show.
Along with having some pretty distinct attributes above the ground, Guernsey County also stands out from its neighbors in terms of what’s happening deep below the surface. Here’s a look at the current status of oil and gas activity in Guernsey County, OH, and what the future might hold for the area.
1. What is the state of the oil and gas industry in Guernsey County?
Nestled in the southeastern portion of Ohio, Guernsey is bordered by six different counties. The thing about Guernsey County, and where it’s located in the Utica Shale Play, is it’s in what’s called the “rich gas window”. It’s not like Southern Jefferson County and Eastern Belmont County, where they have straight dry gas wells. That’s not how Guernsey County works—and it will never work that way.
You’ll find a lot of natural gas liquids and condensate in the wells in Guernsey County. Condensate is essentially another form of oil. Liquids are your butanes, methanes, isobutanes, and different kinds of gases (in liquid form) that have to go through a cryogenic plant and get process treated. In the plants, they get broken down into their gaseous forms and sold off to market.
With that being said, the wells in Guernsey County produce a little bit differently than the wells in some surrounding areas. You’re never going to see a Guernsey well as a top 10 gas-producing well because it isn’t a straight dry gas well. But a Guernsey well can be a top 10 all-around well when you consider all the liquids and condensate it produces. If there’s a lot of barrels of oil coming out of a Guernsey well, then it can be just as valuable as a big gas well.
At the end of the day, it all comes down to economics. So that’s where Guernsey County falls into the play.
2. What operators are active in Guernsey County right now?
The main operator in Guernsey County at the moment is Ascent Resources. The company, founded in 2014, is currently among the top producers of natural gas and petroleum in Ohio. They have a rig operating in Guernsey County right now. They also have some additional wells they’re in the process of drilling, and a few wells that they’ve already drilled but still need to bring online.
Another operator in the area, Eclipse, has drilled what they like to call “super-laterals”. They give them that name because of the great length of the wells. A few years ago, they drilled a series of record-setting super-laterals in the Guernsey County with colorful names like Purple Hayes, Great Scott, and Outlaw. Those wells cemented their position in the region—though they haven’t drilled a new well in Guernsey since that time.
A new company that’s permitted recently in Guernsey County is Utica Resource Operating. They’re drilling some wells, mainly in Richland Township and Western Wills Township, and we don’t have a lot of data on their performance just yet.
3. What does the future look like for oil and gas activity in Guernsey County?
Like other counties in the region, Guernsey County is not quite as far along as in terms of infrastructure as it could be. More infrastructure means the natural gas liquids and condensate can move to processing and market quicker, which ultimately leads to more drilling and production in the area. But the volume of gas is lower in Guernsey County, than the counties to its east. And generally speaking, the pipelines follow the rigs.
According to The Repository, as of November 16, 2019, Guernsey County ranked number five on the list of top 10 Ohio counties by the number of well permits for the year. Guernsey had 279 permits issued—noticeably behind Monroe (446), Harrison (493), Carroll (528), and Belmont (661); and slightly ahead of Jefferson (259) and Noble (236).
With its location in the rich gas window and the unique output its wells produce, Guernsey County will continue to be a draw to operators. Whether drilling and production will ramp up in the area over the coming year remains to be seen at this time. Nevertheless, Guernsey still holds a key position in the southeastern region that’s been so critical to Utica Shale development in Ohio over the past decade.
Are you a Guernsey County landowner interested in learning more about selling your mineral rights or royalties? Talk to Gateway Royalty about your options today!