Marcellus and Utica Shale Databook 2013 – Sample Pages for Vol. 3

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Information about Marcellus and Utica Shale Databook 2013 – Sample Pages for Vol. 3
News & Politics

Published on February 15, 2014

Author: MarcellusDN

Source: slideshare.net

Description

Preview pages for the Marcellus and Utica Shale Databook 2013, Volume 3. This third volume (of three) features 85 detailed maps and charts showing where Marcellus & Utica Shale well permits have been issued throughout PA, OH and WV for September through December of 2013. Each detail map shows major natural gas pipelines, the location of compressor stations, and the locations for each permit issued appended with the driller's name. NEW in this edition: A list of actively used frack waste facilities throughout the northeast--those facilities now being used by Marcellus and Utica Shale drillers. Facilities include centralized recycling, injection wells and landfills. Each facility is identified by name and location (address), including a phone number. Also new: first-time ever research based on over 3,000 Marcellus Shale wells showing the average decline rate for Marcellus wells. This is must-have information for landowners, drillers, and anyone interested in answering the question--just how long (and how much) will a well produce? Many other special features make this an indispensable tool for those with an interest in drilling in the Marcellus/Utica. Visit this page for more details: http://marcellusdrilling.com/databook.

Marcellus and Utica Shale Databook 2013 Volume 3: 2013 Sep-Dec Drilling Permit Maps; Waste Facility List, Calculating Well Decline Rates 85 Detail Maps & Charts, Individual County Maps for Permits Issued Sep-Dec; Regulatory/Legal Update; Permits by Driller and More! January 2014 Edition

Table of Contents Section I - Overview Introduction & Methodology Drilling Update Sep-Dec 2013 Natgas Prices & Infrastructure Linked Henry Hub vs Marcellus Gas Spot Price (chart) Rig Counts Inch Higher in Marcellus/Utica Marcellus/Utica Rig Counts by Play (chart) Well Starts Remain Strong in NE Marcellus/Utica Well Counts by Play (chart) Rigs Migrate from PA to OH & WV Marcellus/Utica Rig Counts by State (chart) Permit Counts – Databook Innovation Marcellus/Utica Permit Counts 2012-13 (chart) # Permits by Driller 2012-13: PA, OH, WV (chart) # Permits by County 2012-13: PA, OH, WV (chart) Regulatory/Legal Update: PA, OH, WV, NY, MD Marcellus/Utica Latest Lease Offers (map) Guide to Using the County Maps (chart) Section II - Pennsylvania Permits (continued) 6 7-10 7 7 8 8 8 8 9 9 10 10 11-14 15-16 17-21 22 23 Section II - Pennsylvania Permits PA Gas Well Permits – Entire State (map) Allegheny County (map) Armstrong County (map) Beaver County (map) ©Marcellus and Utica Shale Databook 2013 – Volume 3 24 25 26 27 Bradford County (map) Butler County (map) Cameron County (map) Centre County (map) Clarion County (map) Clearfield County (map) Elk County (map) Fayette County (map) Forest County (map) Greene County (map) Indiana County (map) Jefferson County (map) Lawrence County (map) Lycoming County (map) McKean County (map) Mercer County (map) Potter County (map) Sullivan County (map) Susquehanna County (map) Tioga County (map) Venango County (map) Warren County (map) Washington County (map) Westmoreland County (map) Wyoming County (map) 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 Sample Pages

Table of Contents Section III - Ohio Permits OH Gas Well Permits – Entire State (map) Belmont County (map) Carroll County (map) Columbiana County (map) Guernsey County (map) Harrison County (map) Hocking County (map) Jefferson County (map) Mahoning County (map) Monroe County (map) Morgan County (map) Muskingum County (map) Noble County (map) Trumbull County (map) Tuscarawas County (map) Washington County (map) ©Marcellus and Utica Shale Databook 2013 – Volume 3 Section IV - West Virginia Permits 53 54 55 56 57 58 59 60 61 62 63 64 65 66 67 68 WV Gas Well Permits – Entire State (map) Barbour County (map) Brooke County (map) Doddridge County (map) Gilmer County (map) Greenbrier County (map) Harrison County (map) Kanawha County (map) Lewis County (map) Marion County (map) Marshall County (map) Monongalia County (map) Ohio County (map) Preston County (map) Ritchie County (map) Taylor County (map) Tyler County (map) Upshur County (map) Webster County (map) Wetzel County (map) 69 70 71 72 73 74 75 76 77 78 79 80 81 82 83 84 85 86 87 88 Sample Pages

Table of Contents Section V – Directory of Marcellus & Utica Drilling Waste Facilities Introduction Flowback and Brine Drill Cuttings and Solid Waste Consolidated Map of Northeast Waste Facilities (map) List of Waste Facilities Sorted by Geography (chart) List of Waste Facilities Sorted by Type of Facility (chart) 89 89 89-90 91 92-97 98-103 Section VI – Calculating Decline Rates for Marcellus Shale Wells Decline Rate Discussion Preface Limited Shale Gas Production Data Production Decline Rates What Current PA Data Suggests Cumulative Production & Decline Curve Estimation for PA Wells (chart) Annual Natural Gas Production Estimates for Average PA Well (chart) Gross Unit Mineral Owner Revenue for Average PA Well (chart) Average Royalties for PA Landowners Decline Rate Observations 104 105 105 105 106 107 108 109 110 Disclaimer: Select Analytics, LLC, dba “ShaleNavigator” and Marcellus Drilling News, are not liable for any direct or indirect damages suffered related to the use of this Databook product arising from any errors, omissions, inaccuracies, or any other inadequacies of the Databook or the Recipient’s use of the Databook. In no event will Select Analytics, LLC’s, dba “ShaleNavigator”’s or Marcellus Drilling News’ liability to the Recipient or anyone else exceed the fee paid for the Databook product. Use of information provided in this report is at your own risk. Editor’s Note: If you spot anything you believe is inaccurate or should be added, tell us! You may qualify for a free MDN or ShaleNavigator subscription. ©Marcellus and Utica Shale Databook 2013 – Volume 3 Sample Pages

Section I - Overview DRILLING UPDATE: SEP-DEC 2013 Natgas Prices & Infrastructure Closely Linked There is a direct connection between infrastructure (pipelines) and the price of natural gas. Natgas is a commodity and like all commodities is very sensitive to market supply and demand. Nowhere is this more evident than in northeastern Pennsylvania where the rapid growth of supply continues to outstrip take-away pipeline capacity. Because there is more supply than demand, the price of natgas in NE PA, particularly along the Tennessee Gas Pipeline, at times has sold for half the price of natgas sold at the benchmark Henry Hub in southwest Louisiana (see the graph at right). By comparison, Marcellus Shale gas sold in southwest PA and WV tracks much more closely with that of the Henry Hub, that is, supply and demand are much more closely matched in that region of the Marcellus (with lots of pipeline takeaway capacity). When will Marcellus natgas in NE PA achieve higher prices? When more pipelines come online. Enter the Constitution Pipeline, due to be completed in March 2015. This new pipeline, a joint project of Williams, Cabot Oil & Gas and several other partners, will connect the massively productive dry gas fields of northeastern PA (particularly Susquehanna County) with two major interstate pipelines: the Tennessee Gas Pipeline and the Iroquois Pipeline in eastern NY. Cabot Oil & Gas alone produces over 1 billion cubic feet per day from their Susquehanna County Marcellus Shale wells. The Constitution will have the capacity to ship 650 million cubic feet per day—or nearly twothirds of Cabot’s current production. When that happens, look for gas prices in NE PA to track much more closely with the Henry Hub price. ©Marcellus and Utica Shale Databook 2013 – Volume 3 Sample Pages

Section I - Overview PERMITS BY DRILLER 2012-2013 Who’s Drilling & How Much? This new section of the Databook was added in Vol. 2. In it we take a look at the number of permits issued by period—by “halfs” for 2012, or Jan-Jun and Jul-Dec, and by “trimesters” for 2013, Jan-Apr, May-Aug and Sep-Dec—for each driller active in either the Marcellus and/or Utica Shale. The numbers reflect a permit received by that driller for a distinct, unique well (not pad, but individual well). That is, if the driller applied for and received a permit for any purpose—to begin drilling, to continue drilling, to frack, to re-drill, etc.—that is considered a permit. We filter out multiple permits for the same well and show only unique, distinct well locations. So a driller with a “42” for a given period means that driller received permits for 42 different, distinct wells for some purpose. Use this information to spot trends and get a high-level overview of activity for a particular driller— where they drill, when they drill, and how much they drill. Pennsylvania Ohio 1H12 AB Resources Alpha Shale Alta Mesa American Energy Anadarko Petroleum Antero Resources Atlas Resources Belden Brick BEUSA Energy Bocor Holdings BP Brammer Engineering BRC Operating Burnett Oil Cabot Oil & Gas Cameron Energy Cambell Oil & Gas Carrizo Chesapeake Energy Chevron Chief Oil & Gas Citrus Energy CNX Gas/CONSOL Energy DAC Energy Denex Petroleum Devon Energy 2H12 1T13 2T13 3T13 5 5 4 1 60 41 7 2 12 4 6 1 7 5 12 1 2T13 19 3 3T13 8 3 18 1H12 93 2T13 3 2 298 204 213 216 15 20 1T13 1T13 5 2 47 2H12 West Virginia 9 42 5 5 1H12 2H12 1 3T13 11 2 4 2 299 2 9 67 3 4 119 3 4 87 24 69 58 105 1 75 1 1 1 1 1 2 1 66 48 46 53 24 184 65 21 3 33 1 6 227 59 19 4 50 1 8 250 59 36 2 11 137 25 53 5 26 31 ©Marcellus and Utica Shale Databook 2013 – Volume 3 63 1 1 20 77 39 74 2 27 3 1 2 1 1 1 135 3 135 3 2 92 2 96 3 3 11 8 7 5 4 63 6 55 19 Sample Pages

Section I - Overview REGULATORY/LEGAL UPDATE New York Permitting and drilling in New York is regulated by the Department of Environmental Conservation (DEC). Fracking Still on Hold Shale gas drilling in New York has been on hold since 2008—now over 5 ½ years. The DEC was supposed to release a final set of new drilling rules, called the Supplemental Generic Environmental Impact Statement, or SGEIS, no later than Nov 29, 2012 (exactly one year from the last public hearing on the new rules). The DEC instead chose to file for a 90-day extension, which expired at the end of February 2013, to allow time for a mini-review of potential impacts shale drilling may have on public health. The State Health Commissioner, Nirav Shah, still has not supplied his health review as of this edition of the Databook (January 2014), so the de facto moratorium remains in place. Landowners have given up on Gov. Cuomo and have resorted to litigation to force the issue to resolution. Several important court cases are now proceeding… Cuomo, Martens, Shah Sued to Force Action Norse Energy bet on New York in a big way, amassing 130,000 acres of oil and gas leases in the state. Their plan was to drill shale wells, but because of the ongoing delay, it forced the company into bankruptcy. Because of the fracking ban, Norse is unable to sell its leases at auction to provide partial payment to creditors. So Norse hired attorney Tom West to file an Article 78 lawsuit against Gov. Andrew Cuomo, DEC Commissioner Joe Martens and State Health Commissioner Nirav Shah. An Article 78 essentially is a citizen (or company’s) legal way of forcing a recalcitrant public official to do his or her job. That is, it will force the release of the new drilling rules, should they win the lawsuit. The Norse Article 78 lawsuit is in the beginning stages and will not be heard by a judge until March 2014. Late-breaking news: As this issue of the Databook went to publication, the Joint Landowners Coalition of New York (JLCNY) served notice to DEC Com. Martens of their own Article 78 lawsuit. They intend to file as well, joining their lawsuit with the one brought by Norse/Tom West. The JLCNY represents 70,000 New York landowners and is also working on another lawsuit for “takings”—the illegal denial of the use of land without just compensation. NY High Court to Hear Two Ban Cases Apart from the question of whether or not the governor (and legislature) allow drilling to commence, a major court battle has ensued over whether or not local municipalities have the right to completely ban hydraulic fracturing. Two NY towns—Dryden and Middlefield—banned fracking and were subsequently sued—in one case by a driller, in the other by a landowner. The towns won the initial lawsuits at a lower court and the cases were appealed. On appeal, the towns won a second time with unanimous decisions (the court decision was handed down in April 2013). The cases were appealed to the highest court in New York—the NY Court of Appeals. In August, the Court of Appeals agreed to hear the twin cases which are being tried together. Oral arguments are likely to be heard this spring and a decision is likely sometime in June. If the high court decides that towns can completely ban drilling, it is our considered opinion that shale drilling in New York will remain forever stunted because most drillers will not “roll the dice” on the whims of 3-2 decisions by town boards voted in and out every few years. The decision by the Court of Appeals in these two cases is at least as, if not more, important than Cuomo’s decision on whether to allow drilling to commence. ©Marcellus and Utica Shale Databook 2013 – Volume 3 Sample Pages

Section I - Overview GUIDE TO USING THE COUNTY MAPS #1 – The municipality or operator name is followed by two sets of numbers, with the second number in parentheses. Example: Cogan House – 23 (20). The first number - “23” in this case - shows the total number of permits issued. The second number “(20)” in this case - indicates how many wells the permits were issued for. Usually a single well requires several permits during drilling, to allow the driller to continue to the next stage. #2 – A red dot indicates where a well pad is located. Each well pad can have from one to ten wells on it. Typically a pad will contain 2-4 wells. Because of the size of the maps (vastly reduced to show an entire county), sometimes the red dots will be “on top of each other” and sometimes will not be labeled with a driller’s name. #3 – The boundary of each county is indicated with a blue outline. #4 – Major gas pipelines are indicated with red lines and the name of the pipeline somewhere along the line. #5 – The location for pipeline compressor stations is indicated by a green triangle–the name is next to it. ©Marcellus and Utica Shale Databook 2013 – Volume 3 Sample Pages

Section II – Pennsylvania Permits Lycoming County By Municipality: Anthony – 2 (2) Cascade – 4 (4) Cogan House – 23 (20) Cummings – 13 (13) Eldred – 3 (3) Fairfield – 3 (3) Gamble – 1 (1) Lewis – 18 (18) McHenry – 11 (10) McNett – 2 (2) Pine – 15 (15) Upper Fairfield – 10 (10) By Operator: Anadarko Petroleum – 44 (41) Atlas – 1 (1) Carrizo Oil & Gas – 1 (1) Chief Oil & Gas – 1 (1) Inflection Energy – 16 (16) PA General Energy – 16 (15) Range Resources – 10 (10) Seneca Resources – 14 (14) Southwestern Energy – 2 (2) ©Marcellus and Utica Shale Databook 2013 – Volume 3 Sample Pages

Section III – Ohio Permits Noble County By Municipality: Beaver – 3 (2) Brookfield – 1 (1) Center – 3 (3) Marion – 4 (4) Seneca – 4 (4) Stock – 1 (1) Wayne – 2 (2) By Operator: Anadarko Petroleum – 1 (1) Antero Resources – 11 (11) Eclipse Resources – 6 (5) ©Marcellus and Utica Shale Databook 2013 – Volume 3 Sample Pages

Section IV – West Virginia Permits Upshur County Entire County: 52 (21) By Operator: Chesapeake Energy – 2 (1) CNX Gas – 33 (8) EQT – 2 (2) Mountain V Oil & Gas – 10 (7) Ross & Wharton Gas – 3 (2) Seneca-Upshur Petr – 2 (1) ©Marcellus and Utica Shale Databook 2013 – Volume 3 Sample Pages

Section V – Directory of Frack Waste Facilities DIRECTORY OF MARCELLUS & UTICA DRILLING WASTE FACILITIES A Comprehensive List of Facilities Most-Used to Dispose of Frack Wastewater & Drill Cuttings We are very excited to bring you what we believe to be the most comprehensive list of waste disposal facilities for frack waste in existence for the Marcellus and Utica Shale region. In the lists that follow you will see waste disposal options listed by type of disposal: centralized treatment plants, injection wells and landfills, primarily. We also show a few other options (long-term storage and cuttings recycling). Each facility's address is given along with the county where it's located. Flowback and Brine Wastewater from shale drilling is a by-product of drilling and comprised primarily of two components. The first is “flowback”–the water, sand and chemical mixture used during the drilling and hydraulic fracturing process that returns to the surface. An average 20% of fracking fluid pumped into a borehole comes back to the surface. The second component of wastewater is naturally occurring “brine,” also known as “produced water.” An interesting fact not known by many outside of the drilling industry is that there is a lot of water deep in the earth--far below the water aquifers we use for our drinking water. These water sources from a mile or more down produce naturally occurring water heavy with minerals—like sodium chloride, calcium chloride, magnesium chloride—various kinds of salt compounds. This mineral laden water is called brine because the water is very salty—far more salty than ocean water by comparison. The brine, often called “produced water” needs to be disposed of along with flowback water. Produced water comes to the surface weeks, months, and in some cases years after a well is drilled. Produced water/brine does not contain the chemicals found in flowback—but the minerals and chemicals present in brine are potent nonetheless, and brine, along with flowback, must be properly recycled or disposed of. Many drillers now recycle part or even all of the flowback and produced water that comes from the wells they drill. Sometimes wastewater recycling is done right at the drill site, and sometimes it’s done at regional sites set up by the driller to service all of their well drilling activities in a given area. However, some drillers are not prepared to handle the extra activity of flowback and brine recycling themselves (due to size of the company, geographic constraints, etc.). For those drillers who do not recycle on site or at their own regional facilities, there are several methods for disposing of flowback and brine. The two primary methods are to ship it to a centralized recycling facility owned by a third party, set up for that purpose, or ship it to an underground injection well where it is permanently pumped deep into the earth. In some cases flowback and brine can be stored until it is eventually disposed of either by recycling or injection well. Some brine is processed to strip out the salts leaving the water usable for spreading on roads in summertime as a dust suppressant. The salts in brine can be further processed to be used as ice treatments for roadways during wintertime. Drill Cuttings and Solid Waste In addition to wastewater (flowback and brine), as the drill bit chews through the earth, all of the rock and soil and semi-liquid drilling mud pumped down the borehole comes out and must disposed of. As drillers cut through various rock layers, some of those rocks contain low levels of naturally occurring radioactivity. Most of the time the radiation is so low it's undetectable. On occasion “drill cuttings,” as this mix of rock and dirt and drilling mud is called, trips a radiation alarm. In those cases the drill cuttings must be disposed of in a specially permitted landfill—or treated before Continued on next page… ©Marcellus and Utica Shale Databook 2013 – Volume 3 Sample Pages

Section V – Directory of Frack Waste Facilities DIRECTORY OF MARCELLUS & UTICA DRILLING WASTE FACILITIES List of Waste Facilities Sorted by State-County-City (1 of 6) DISPOSAL METHOD OPERATOR/FACILITY NAME ADDRESS CITY STATE ZIP COUNTY LANDFILL HYLAND FACILITY ASSOCIATION 6653 HERDMAN RD ANGELICA NY 14709 ALLEGANY (585) 466-7271 LANDFILL CHEMUNG COUNTY LANDFILL 1486 COUNTY RD 60 LOWMAN NY 14861 CHEMUNG (585) 797-5941 LANDFILL ALLIED WASTE SYSTEMS 5600 NIAGARA FALL BLVD NIAGARA FALLS NY 14304 NIAGARA (716) 285-3344 STORAGE ENVIRONMENTAL PRODUCTS & SERVICES OF VERMONT 532 STATE FAIR BLVD SYRACUSE NY 13209 ONONDAGA (315) 451-6666 LANDFILL HAKES C&D LANDFILL 4376 MANNING RIDGE RD PAINTED POST NY 14870 STEUBEN (607) 937-6044 INJECTION WELL MONROE PARNTERS - MONROE #1 HILLDOM RD CONNEAUT OH 44030 ASHTABULA (412) 395-3921 WASTEWATER RECYCLE PETROWATER INC 1972 FOOTVILLE-RICHMOND RD JEFFERSON OH 44047 ASHTABULA (440) 563-9475 INJECTION WELL PETROWATER INC - DIETRICH # 1 2201 STATE RTE 167 JEFFERSON OH 44047 ASHTABULA (440) 994-9089 INJECTION WELL D&L ENERGY - PAROBEK #2 (SWIW #12) US 6 NEW LYME OH 44047 ASHTABULA INJECTION WELL AMERICAN ENERGY - RENSHAW / BRADNAN #1 DISPOSAL WELL 1548 OHIO 7 PIERPOINT OH 44082 ASHTABULA (440) 862-4041 INJECTION WELL B&B OILFIELD SERVICES - MILLER & CO #3 (SWIW #28) 6794 STATE RTE 86 WINDSOR OH 44099 ASHTABULA (330) 527-5377 INJECTION WELL CARPER WELL SERVICE - GINSBURG DISPOSAL WELL #1 LADD BRIDGE RD ALBANY OH 45710 ATHENS (412) 395-3921 INJECTION WELL K & H PARTNERS LLC #1 (SWIW #8) 28333 WEST BELPRE PIKE COOLVILLE OH 45723 ATHENS (304) 488-0701 INJECTION WELL CNX GAS - BUCKEYE UIC BARNESVILLE #1 (SWIW#2) WALKER RD, TOWNSHIP HWY 165 BARNESVILLE OH 43713 BELMONT (740) 425-9180 INJECTION WELL DAVID R HILL, INC - GEORGETOWN MARINE #1 SWIW 1 COUNTY RD 214 BELLAIRE OH 43906 BELMONT (330) 363-0239 INJECTION WELL DOWNRIGHT BRINE DISPOSAL - STEPHENSON #1-D CUTLER RD SHERRODSVILLE OH 44675 CARROLL (330) 544-6566 INJECTION WELL PREFERRED FLUIDS MGMT - ADAMS #1 (SWIW #10) 23986 AIRPORT RD COSHOCTON OH 43812 COSHOCTON (740) 575-4482 RECYCLE CUTTINGS OHIO SOIL RECYCLING, LLC 2101 INTEGRITY DR S COLUMBUS OH 43209 FRANKLIN (614) 444-7645 INJECTION WELL HUFFMAN-BOWERS, INC - ROJ#1-A OLIVER RD, PO BOX 538 CHESIRE OH 45620 GALLIA (740) 621-1127 INJECTION WELL DAVID R HILL INC - DEVCO UNIT #1 (SWIW #11) 57901 CLAYSVILLE RD CAMBRIDGE OH 43725 GUERNSEY (740) 638-2068 INJECTION WELL SILCOR OILFIELD SERVICES - SOS-D #1 (SWIW #12) 61514 SOUTHGATE PARKWAY CAMBRIDGE OH 43725 GUERNSEY (330) 759-1822 INJECTION WELL SELECT ENERGY SERVICES - SLIFKO SWIW#10 10176 BANNER RD PLEASANT CITY OH 43772 GUERNSEY (940) 668-1818 LANDFILL APEX SANITARY LANDFILL 11 COUNTY RD 78 AMSTERDAM OH 43903 JEFFERSON (740) 543-4389 INJECTION WELL B&J DRILLING - DANVILLE FEED & SUPPLY (SWIW #9) 14052 HUMBERT RD HOWARD OH 43028 KNOX (740) 392-2941 INJECTION WELL ELKHEAD GAS & OIL - CHAPIN WELL # 7 (SWIW # 8) 9170 RUTLIDGE RD HOWARD OH 43028 KNOX (740) 403-9664 WASTEWATER RECYCLE CHEMTRON - PLANT 1 35850 SCHNEIDER CT AVON OH 44011 LORAIN (800) 676-5091 LANDFILL VIENNA JUNCTION LANDFILL 6233 HAGMAN RD TOLEDO OH 48133 LUCAS (419) 726-9465 INJECTION WELL BRINEAWAY, INC - JENKINS #1 19220 US RT 62 BELOIT OH 44609 MAHONING (330) 938-2172 LANDFILL CARBON LIMESTONE LANDFILL - BFI 8100 SOUTH STATE LINE RD LOWELLVILLE OH 44436 MAHONING (330) 536-8013 ©Marcellus and Utica Shale Databook 2013 – Volume 3 PHONE Sample Pages

Section V – Directory of Frack Waste Facilities DIRECTORY OF MARCELLUS & UTICA DRILLING WASTE FACILITIES List of Waste Facilities Sorted by Disposal Method-State-County (3 of 6) DISPOSAL METHOD OPERATOR/FACILITY NAME ADDRESS CITY STATE ZIP COUNTY INJECTION WELL EXCO RESOURCES - IRVIN A-19 SWIW (033-00053) FRANTZ HOLLOW RD MAHAFFEY PA 15757 CLEARFIELD (724) 720-2560 INJECTION WELL MORRIS H CRITCHFIELD - F76 DISP WELL (111-20006) TWIN HILLS RD FRIEDENS PA 15541 SOMERSET (724) 627-1246 INJECTION WELL DANNY E WEBB CONSTRUCTION, INC 617 TOWN HOLLOW RD LOCHGELLY WV 25866 FAYETTE (304) 465-9448 INJECTION WELL VIKING ENERGY OLD TUPPERS CREEK RD CHARLESTON WV 25312 KANAWHA (304) 984-1161 INJECTION WELL BASE PETROLEUM, INC BIG FORK RD ELKVIEW WV 25071 KANAWHA (304) 756-2827 INJECTION WELL HAWG HAULING & DISPOSAL, INC 5102 US 33 CAMDEN WV 26338 LEWIS (304) 472-1149 INJECTION WELL LAW 1 (47-041-03175) RT 33 CAMDEN WV 26338 LEWIS (304) 269-6461 INJECTION WELL CAMP CREEK DISPOSAL SERVICES - 14397 REV (47-055-00319) 200 CAMP CREEK RD CAMP CREEK WV 25820 MERCER (276) 880-2323 INJECTION WELL ALAMCO, INC - GRER A-1 SALTWATER DISPOSAL 1862 SNAKE HILL RD MORGANTOWN WV 26508 MONONGALIA (304) 864-7807 INJECTION WELL APPALACHIAN OIL PURCHASERS, INC HENRY CAMP RD ST MARYS WV 26170 PLEASANTS (304) 665-1258 INJECTION WELL BASE PETROLEUM, INC 398 CLAYPOOL HOLLOW RD GLEN DANIEL WV 25844 RALEIGH (304) 756-2827 INJECTION WELL VIKING INTERNATIONAL - ELDER 2 DISPOSAL (47-085-051) GILLESPIE RUN RD CAIRO WV 26362 RITCHIE (740) 373-4599 INJECTION WELL VIRCO - HARRISVILLE WELL ME ELDER 1 GILLESPIE RUN RD CARIO WV 26337 RITCHIE (304) 628-3444 INJECTION WELL HAUGHT ENERGY CORP - MASON WELL #1 (47-085-09721) 122 LONESOME PINE RD ELLENBORO WV 26346 RITCHIE (740) 236-2135 INJECTION WELL VIKING INTERNATIONAL RESOURCES CO, INC CR-26 HARRISVILLE WV 26362 RITCHIE (740) 373-4599 INJECTION WELL HALL DRILLING, LLC CR-50/39 PENNSBORO WV 26415 RITCHIE (304) 869-3404 INJECTION WELL HAWG HAULING WV DISP WELL - MARQT 211871 RR1 BOX 84A BUCKHANNON WV 26201 UPSHUR (304) 472-1149 INJECTION WELL STONEBRIDGE OPERATING COMPANY - KORTING #1 2130 HARRIS HWY WASHINGTON WV 26181 WOOD (304) 481-5824 INJECTION WELL STONEBRIDGE OPERATING COMPANY - PAUL HAHN #2 2130 HARRIS HWY WASHINGTON WV 26181 WOOD (304) 481-5824 LANDFILL HYLAND FACILITY ASSOCIATION 6653 HERDMAN RD ANGELICA NY 14709 ALLEGANY (585) 466-7271 LANDFILL CHEMUNG COUNTY LANDFILL 1486 COUNTY RD 60 LOWMAN NY 14861 CHEMUNG (585) 797-5941 LANDFILL ALLIED WASTE SYSTEMS 5600 NIAGARA FALL BLVD NIAGARA FALLS NY 14304 NIAGARA (716) 285-3344 LANDFILL HAKES C&D LANDFILL 4376 MANNING RIDGE RD PAINTED POST NY 14870 STEUBEN (607) 937-6044 LANDFILL APEX SANITARY LANDFILL 11 COUNTY RD 78 AMSTERDAM OH 43903 JEFFERSON (740) 543-4389 LANDFILL VIENNA JUNCTION LANDFILL 6233 HAGMAN RD TOLEDO OH 48133 LUCAS (419) 726-9465 LANDFILL CARBON LIMESTONE LANDFILL - BFI 8100 SOUTH STATE LINE RD LOWELLVILLE OH 44436 MAHONING (330) 536-8013 LANDFILL SOIL REMEDIATION INC (SRI) 6065 ARREL-SMITH RD LOWELLVILLE OH 44436 MAHONING (330) 536-6825 LANDFILL WASTE MANAGEMENT, INC - MAHONING LANDFILL, INC 3510 GARFIELD RD NEW SPRINGFIELD OH 44443 MAHONING (330) 549-5357 LANDFILL TUNNELL HILL RECLAMATION LANDFILL 2500 TR 205 RTE 2 NEW LEXINGTON OH 43764 PERRY (740) 342-1180 ©Marcellus and Utica Shale Databook 2013 – Volume 3 PHONE Sample Pages

Section VI – Marcellus Shale Well Decline Rates CALCULATING DECLINE RATES FOR MARCELLUS SHALE WELLS Ladlee & Karabin: General Trends and Averages for Marcellus Shale Well Production Limited Shale Gas Production and Economic Data Available The first issue, which raises concerns about shale gas economics, is the limited data currently available for the long-term production characteristics and economic performance of shale gas wells in the Marcellus Shale. The shortage of data can be attributed to the fact the shale industry is still in its infancy in the Appalachian Basin. It has only been within the last decade that companies have had success producing commercial quantities of natural gas in the Marcellus Shale, as a result of the utilization of horizontal drilling and multi-stage hydraulic fracturing. Shale gas plays that have been producing for longer periods of time include the Barnett Shale in Texas and the Fayetteville Shale in Arkansas, with each of these plays producing gas since the 1980’s. The Barnett Shale and Fayetteville Shale were two of the first plays to utilize horizontal drilling and hydraulic fracturing and have generated the greatest amounts of data to evaluate the production and economic performance of shale gas wells. The information from these two shale gas plays has been used to compare new well production data in recently developed shale deposits such as the Marcellus shale. Utilizing other shale formations as comparison is thought to be acceptable because the geologic qualities of all three shale deposits are somewhat similar. While similarity is important and can lead to useful extrapolation of data, there is no guarantee that the wells drilled in the Marcellus Shale will behave in the same fashion. Overall, the lack of data on the long-term performance of shale gas wells in the Marcellus Shale results in a strong reliance on forecasts and analysis from other formations to predict what may happen. Production Decline Rates While a lot of data may not exist relating to the long-term performance of shale gas wells, it is known with certainty that all shale wells will experience significant declines in productivity over time. Shale gas wells experience production declines due to the low permeability characteristics of shale deposits and the low concentration of gas, spread over large areas. Wells typically found in the Marcellus Shale will experience a production decline rates of approximately 65-85 percent within the first twelve months, with subsequent declines in production throughout the remaining life of the well. Depending on how the productivity of the well is modeled, and what the initial production values are, the EUR (expected ultimate recovery) for the well can vary considerably. The EUR calculations are critically important as they are used to forecast the expected revenue, depletion calculations and overall profitability of the well. With highly variable EURs, the economics of shale gas wells can quickly change from positive to negative. What Current Pennsylvania Data Suggests The search for a more accurate royalty calculator ultimately ends in a search for the cumulative production, decline, and expected ultimate recovery for shale wells. As a new phenomenon in the Appalachian Basin, the historic cumulative production and decline curve models were not a great fit for the new Marcellus wells coming online. Traditional exponential decline models, which estimate at a constant percentage or rate of decline each year, appear to significantly overestimate shale well production. While a pure hyperbolic decline model, which is characterized by a concave form, appear to significantly under estimate well recovery. Combined models from the Barnett Shale in Texas are a closer representation to what the production data indicates in the Appalachian Basin; however, Marcellus wells appear to have a slightly slower initial decline, which may indicate greater recovery over a longer period of time. Given the challenges of using prior decline models, a new estimation system would be needed to provide a reasonable range for ultimate recovery, decline modeling, and royalty estimation. ©Marcellus and Utica Shale Databook 2013 – Volume 3 Sample Pages

Marcellus and Utica Shale Databook 2013 Volume 1: 2013 Drilling Permits (Jan-Apr); 2011-2013 Trends by State & County, Drilling Contacts Publish Date: May 2013 Volume 2: 2013 Drilling Permits (May-Aug), List of Pipeline/Infrastructure Projects, Permits by Driller 2012-2013 Publish Date: Sep 2013 Volume 3: 2013 Drilling Permits (Sep-Dec), Waste Facility List, Calculating Well Decline Rates, Permits by Driller Publish Date: January 2014 Purchase Options Buy each volume individually for $149, or buy all three for $447 $298 Buy the 2012 3-volume series for $149 Site licenses/volume discounts also available, contact us for details To purchase, contact: Marcellus Drilling News Web: marcellusdrilling.com/databook Email: databook@marcellusdrilling.com Phone: (607) 218-2005 ©Marcellus and Utica Shale Databook 2013 – Volume 3 Sample Pages

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