Marcellus gas production increases sharply since ’09

WHEELING – Consol Energy is pumping 17 percent more natural gas than it did last year, a continuing pattern among numerous companies that shows overall Marcellus Shale production is six times higher than in 2009.

“A year ago, we were not expecting the Marcellus to be at 12 billion cubic feet (per day),” said Sam Gorgen of the federal Energy Information Administration, which is the office at the Department of Energy that released a report Tuesday on the increase in activity in the industry.

The vast majority of the Marcellus gas is coming from Pennsylvania and West Virginia. The shale also lies under other states, but most of the wells in Ohio produce oil, while New York maintains a moratorium on shale gas drilling. The Utica Shale, a much older and deeper rock formation than the Marcellus, underlies much of Ohio and some of West Virginia.

The 12 billion cubic feet per day average for Marcellus production is the energy equivalent of roughly 2 million barrels of oil per day, according to the administration.

For perspective, if the Marcellus Shale region were a country, its natural gas production would rank third in the world, after Russia and the rest of the U.S. According to Pennsylvania-based Marcellus Shale Coalition, an industry trade group to which most local frackers belong, the formation now yields twice as much natural gas per year than the entire nation of Iran.

Locally, drillers such as Consol, Chesapeake Energy, Chevron, Stone Energy, Gastar Exploration, Antero Resources and Magnum Hunter Resources have been drilling and fracking into West Virgnia’s Marcellus Shale for the past few years. Most of the activity began in Wetzel County before drillers slowly made their way north to Marshall, Ohio, Brooke and Hancock counties. Tyler County has also seen a surge in leasing and drilling over the past year.

The current Marcellus production is even higher than the predictions of Terry Engelder, a Penn State University geologist who has drawn praise and criticism for his estimates of how much gas the region holds. He previously said daily Marcellus yields would not reach the 12 billion cubic foot rate until 2015.

“This is spectacular, relative to what we thought a few years ago,” Engelder said of the report.

According to the report, natural gas production has risen throughout the nation over the past year, but 75 percent of the increases have come from the Marcellus. Other formations the administration tracks include the Bakken Shale in North Dakota, the Niobrara Shale in Colorado and Wyoming, the Permian Shale in Texas, the Eagle Ford Shale in Texas and the Haynesville Shale in Texas and Louisiana.

Leading one of the companies working in the Marcellus, Consol Chairman and Chief Executive Officer J. Brett Harvey said the company plans to continue growing production with more drilling rigs.

“Our rebounding rig count and our well results will, we believe, enable us to achieve our 2014 production guidance of 210 225 billion cubic feet, which represents a 22 percent 30 percent growth rate over expected 2013 production,” he said of the total yearly projected production.

Also Tuesday, the coalition named David Spigelmyer, a former Chesapeake vice president, as the organization’s new president.

“It is our collective responsibility to make certain that we continue to get this historic opportunity right, now and for generations to come, and we will deliver this message to stakeholders at all levels in a positive and fact-based manner,” Spigelmyer said.

“Dave is a proven leader with unquestionable character, passion and experience. We’re thrilled to have him in this role,” added MSC chairman and Consol Chief Operating Officer of Gas Operations Randy Albert.