The Marcellus might need fewer rigs than previously thought. At Enercom in Denver last week, Cabot Oil & Gas indicated that drilling on synthetic muds should lead to higher drilling efficiencies.  Consequently, the company believes it can work through its Marcellus program with fewer rigs. Pilot tests are expected to get underway this year.

Among other takeaways from Enercom reported in The Unconventional Drilling Report, Atlas is planning a 3 well exploratory program to kick off the new Collingwood shale play this year.  The wells will be drilled in three western counties of Michigan.  A rig was secured for the 3-well program; it has to be brought in from another area. The company didn't say, but a rig from the Marcellus region wouldn't be a total surprise, given the operator.

Also evident at Enercom were signs that the Montana Bakken is clearly gaining attention.  Brigham Exploration is active in Richland County.  One interesting nugget:  It appears the rock is harder in western areas of the Bakken.  

Expect a sharp increase in Michigan Basin drilling in the months to come, courtesy of a promising new shale play dubbed the Collingwood. Adding to the allure is a liquids component—all the rage in unconventional plays these days. Given the lack of big rigs in Michigan, opportunities abound for 1,000 hp and larger rigs suited for drilling long laterals.

EnCana subsidiary Petoskey Exploration opened the new shale play in Michigan with the testing of the State Pioneer 1-3 well in Missaukee County. In the process, it spawned a record lease sale as operators from outside Michigan scrambled to snatch up acreage in the newest example of the ever-proliferating unconventional resource boom that is redefining U.S. drilling.

The sale drew $178.3 million in bids, or just over $1,500/acre, vs. the $26/acre earned at earlier auctions.  Most of the money came from outside Michigan.  Chesapeake took most of the sale’s leases. EnCana had already built a substantial lease position with >250,000 acres. Lease sale results are being finalized and will be made public in early June.