November 2012, Vol. 239 No. 11

In The News

New Estimate Of Utica Shale Reserves

Government officials report the Utica Shale formation holds about 38 Tcf of recoverable natural gas. In its first assessment the U.S. Geological Survey said it estimates the formation holds about 940 million barrels of oil and 9 million barrels of natural gas liquids.

A report by the Energy Information Administration says gas production has flattened since late 2011 in response to lower prices but volumes remain at historically high levels. From January through July, marketed production set a record for the first seven months of any year, averaging 69 Bcf/d, up 4 Bcf/d, or 6%, from the same period a year earlier.

The number of drill rigs operating in Pennsylvania’s Marcellus Shale may be declining, but production keeps going up. Natural gas output increased robustly during the first half of this year, according to state Department of Environmental Protection data.

Pennsylvania’s shale gas wells produced 895 Bcf in the first six months of 2012 – averaging 5 Bcf/d – up 42% from the previous reporting period, said Powell Shale Digest, a trade publication in Fort Worth. Low prices have cut into drilling activity.

Production should continue rising because one-third of drilled wells are not yet selling their output to the market, said Thomas Murphy at Penn State’s Marcellus Center for Outreach & Research. Many wells already fracked are shut in while awaiting pipelines to take the gas to market.