EQT talks Oil Window 2/13/2014 Good or Bad?

From their CC today.
"In our Ohio Utica play, we announced a 21 well program for 2014. The intent of this program is to see if we can crack the code in the condensate light oil window. While our first three wells were frankly, mediocre, we are encouraged enough by initial results to try very specific changes to our drilling and completion design intended to improve the economics materially. If we are successful, there is significant acreage available nearby at relatively inexpensive prices largely because of the skepticism about this part of the play.
As you know, we pride ourselves on being innovative, but we need to be confident that successful innovation creates a sufficient reward and the ability to expand our Utica opportunities that economically provides that. By year end, we hope to either demonstrate sufficient improvements in which case it would make sense to add acreage, or conclude that we cannot achieve the needed improvements at this time and discontinue drilling."

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Permalink Reply by TM on February 13, 2014 at 7:38pm

Here are some questions and answers from the conference call by EQT

Are there any new Utica wells in Ohio that you could speak about? Any new well results?

No. We don't have any well results and it'll be likely mid-year before we start getting results from our revised completion program. So midyear at the earliest, I'm not sure we'll be talking about them mid-year. So I don't want to get your expectations up, but it'll be awhile before we even start to get results ourselves.

Okay. And so is the thinking of not releasing results that you kind of potentially have better results, and then you can lease up acreage. Is that the thinking?

Well, I think, yes, that's a big part of it. And we tend to like to make sure we understand the results before we start talking about them. So sometimes, that takes a little bit of time. So the biggest driver would be, if successful, if we unlock the code in that oily part of the Utica, we want to take advantage of that knowledge before we let everybody else know.

http://seekingalpha.com/article/2020091-eqt-management-discusses-q4...

Permalink Reply by Joe Yurina on February 13, 2014 at 7:43pm

EQT's mediocre doom & gloom of the 3 Guernsey Co/Spencer Twp wells may be a good business decision/tactic to remain one step ahead of the competition. Keep in mind, there was a significant infrastructure cost exposure incurred for the most part to support the 2014 drill plan stated as 21 wells.

Also taken from the CC analysts questions;

Andrew Venker - Morgan Stanley, Research Division

Okay. And so is the thinking of not releasing "Utica, Gue Co" results that you kind of potentially have better results, and then you can lease up acreage. Is that the thinking?

Steven T. Schlotterbeck - Senior Vice President and President of EQT Exploration & Production

Well, I think, yes, that's a big part of it. And we tend to like to make sure we understand the results before we start talking about them. So sometimes, that takes a little bit of time. So the biggest driver would be, if successful, if we unlock the code in that oily part of the Utica, we want to take advantage of that knowledge before we let everybody else know.

Permalink Reply by TM on February 13, 2014 at 8:15pm

Wonder why EQT released the results from their Guernsey wells then? If they are worried about everyone else knowing why release them then? Sounds as though they have a revised completion program in place which sounds promising. Maybe they can unlock the code who knows?

Permalink Reply by James Vanderink on February 13, 2014 at 7:53pm
Thanks Fellas, I didn't get that far into it. EQT, Anadarko, Devon and Enervest are probably all working together. Lots of oil down there.... that's no secret. Just think of the all that Oil Window acreage out there on the "cheap".

Joe, they wouldn't do that would they? Lol

I guess they don't realize we have Mike Fulper counting the oil tankers going out everyday. Thanks MF
Permalink Reply by Joe Yurina on February 13, 2014 at 8:29pm

If EQT stumbles; Aubrey, Eclipse, or another player will be more than happy to get that oil out of the ground.  They all have deep pockets, however want to do it on the cheap if possible.

The 3 (Spencer) wells were from earlier completion and the numbers were ODNR reported as Q3 production. This is the "mediocre" results discussion.

The analysts were questioning the current top-set 5 well completions...which are currently being drilled, this IP or production info will not be available till Q3 at best....and no doubt will be held close to the vest as long as possible.

Permalink Reply by Mike Fulper on February 14, 2014 at 11:23am

ahhahahaha.... Hey.... just my 2 cents worth.....

THERE IS MORE OIL DOWN THERE then the world can use...!

Cost to get it up and out... will come down....

All along.. I knew that OIL is what EQT wants.. not gas....

Simple...

The WORLD operates on OIL....!!  not gas...

They are taking their time....LEARNING as they go....

By the time they get to MY WELLS....:) Kamm's... they will have the code.. if not already.

and I will be buying Steaks at the Forum for all you guys....:)

The reason for just 2 or three Horizontals at each site. is to get it down pat...

The LONGER the Frac legs stay LOADED WITH PRESSURE.. ie non use....the MORE OIL

will be available...

BIG GIANT PUMPS will SUCK it up out....

30,000 BBL of oil a day were taken out in the 1800's  BY A HAND DUG WELL...!!

That's just what WORKED ITS WAY UP.. from the SHALE...

JUST THINK... WHATS DOWN THERE....

It didn't all "wick" itself out...

OIL BOY...OIL.... JUST LIKE... JEB CLAMPETT'S...

Relax.....

another big clue is Aubrey....he is HERE.... not over there....!

Permalink Reply by Jim Litwinowicz on February 13, 2014 at 8:37pm

They will "tell" us by their actions. Watch the wells closely. If, after they drill them, they start leasing more land, you will know they were happy with the results.  Even if they start leasing before the wells are fracked and/or flared as they will be taking core samples.  If they start leasing, start asking for more money.

Permalink Reply by James Vanderink on February 14, 2014 at 5:25am
I think they are looking at a few targets in Muskingum County within their AMI.
Permalink Reply by INVICTUS on February 14, 2014 at 7:38am

Look for the operators who ask ODNR to delay reporting of the actual drilling core results within their completions reports.

This interpretive data can be classified as proprietary for one year and the ODNR Geologist will cooperate in these specific requests.

That data is the holy grail for unlocking what is down there.

The final key is the production data, now reportable every quarter.

Correlations and interpretations between these items is the competitive edge the producers want in order to finalize their HBP positioning in the Utica.

We are now in the beginnings of the final stages of that positioning as players exit, competitors

become fewer and fewer (or merge into JV's), and the stragglers for HBP are sewn up.

Folks, there simply are currently not enough rigs to go around and grab all of the expiring leases that are in primary terms.

Permalink Reply by Mike Fulper on February 14, 2014 at 11:28am

Clark well is not producing much...

So they don't HAVE TO REPORT what it is doing...

Simple...

They are holding back.... to keep the big guys wondering....

Watch for things to take off after the NEXT quarterly report....

Jeb

Permalink Reply by Tony Yurina on February 20, 2014 at 2:13pm

Watch the E&P company who states their wells are "mediocre" at best, yet has recorded a large number of leases in that same county and contiguous townships over the last 3 months !!!  

Permalink Reply by Eric on February 14, 2014 at 8:47am

i just saw a landman posting for chesapeake in utica ohio. That location seems odd to me as it is on the know/licking county line area.

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