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Privately owned, Dallas-based Chief Oil & Gas and Union Drilling Inc., Fort Worth, Texas, (Nasdaq: URDL) have taken delivery of the first rig designed for horizontal drilling in the Marcellus shale.
            

Chief senior vice president of operations William Buckler says the AC Quicksilver will be used in Lycoming County, Pennsylvania.
            

“This is an exciting time for Chief Oil & Gas and the commonwealth of Pennsylvania,” Buckler says. “This new drilling system and its cutting-edge technologies will enable Chief to efficiently and cost-effectively develop the rich natural gas deposits in the Marcellus shale.”
            

This is the first of several new-build rigs planned by Chief for the Marcellus. The next new rig is expected to go into operation in early spring 2009, Buckler says. He adds that the company expects to have six rigs running in the Marcellus by the end of 2009.
            

The 1,600-horsepower rig was built by Houston-based IDM Group, is operated by Union Drilling and is under a three-year contract to Chief.
             

“This new rig design is especially well-suited for Appalachia’s rugged terrain and the Quick-Move technology will allow Chief to rig down, then rig up on a new location within 100 miles, in less than 48 hours,” says Union Drilling chief executive Christopher D. Strong.  “It also allows for faster, more efficient drilling and has the capability to drill longer horizontal laterals.”
            

Strong says that the rig also employs QuickSkid technology which allows for more efficient drilling of multiple wells from one pad site, reducing the impact on the environment.
            

He adds that to remove gas from the Marcellus, the well is drilled straight down, or vertically, more than a mile below the surface and then turned to drill horizontally into the shale. After the drilling is complete, water and sand are pumped into the well, causing small fractures in the shale to release the gas, a process called hydraulic fracing allowing the gas to be collected through a system of pipelines that take the gas to needed markets.
            

Buckler says, “Chief has been drilling and producing clean natural gas from shale for more than a decade, and we are proud of our environmental record.”
            

Chief built a large position in the Barnett shale and sold its holdings there to Oklahoma City-based Devon Energy Corp. (NYSE: DVN) in May 2006.
            

The Marcellus runs from the southern tier of New York, through the western portion of Pennsylvania into the eastern half of Ohio and through West Virginia. In Pennsylvania, the formation extends from the Appalachian plateau into the western valley and ridge.
            

Scientists estimate that the Marcellus holds 500 trillion cubic feet of gas. JAS