The Utica Shale has recently been receiving increasing attention in the press and from the oil and gas industry.

An informative article discussing the Utica Shale can be found on Geology.com.

Range Resources was one of the first major gas companies to recognize the potential of the Marcellus, and now Range appears to be blazing the trail into the Utica. Range CEO John Pinkerton was recently discussing the potential for a “triple play” in the Marcellus, with drilling targeting both the Utica and Upper Devonian shales that cover about 60 percent of the acreage Range has leased in the Marcellus.

As development has progressed, the Marcellus has gradually transitioned from an unknown quantity into a well-understood reserve. The same is not true of the Utica, which has not yet been tested extensively. However, the initial results look promising; Range Resources has reported that its first Utica well drilled in Pennsylvania has averaged 4.4 MMcf/day in a seven day production test.

At this point, the major gas companies have enough acreage leased in the Marcellus to keep them busy drilling for quite a while. With the well known Marcellus readily available, it seems likely that there might not be much push to rapidly develop the Utica, at least while the price of natural gas remains low. Nevertheless, this commentator would suggest that there are some points that landowners (and professionals serving landowners) in areas prospective for the Utica Shale should keep in mind:

-       Natural gas development and production in the sweet spots of Pennsylvania could go on for a very long time.  There seems to be a general consensus that Marcellus wells could produce for twenty years or more.  Now, landowners may possibly add on an additional twenty years after drilling for the Utica begins.  Truly, this is a multi-generational play.

-       Current projections and estimates of the wealth that landowners could receive from natural gas royalties may be low. The appraised value of gas rights may run into millions of dollars for substantial Marcellus acreage when fully developed. Those numbers will only go up as the potential for production from the Utica and Upper Devonian is factored in.