Wednesday, May 13, 2009

Drop in natural gas price slows Marcellus shale development

The recession-induced decline in the price of natural gas has slowed development of Marcellus shale deposits in Pennsylvania, but development is expected to accelerate once prices pick up in 2010.
Virtually all of the Marcellus wells are still in the exploratory stage, with only one in southwestern Pennsylvania sending gas into a production pipeline.
The 365 million-year-old layer of rock that contains the gas underlies 54 of Pennsylvania's 67 counties. The rock is believed to hold 363 trillion cubic feet of natural gas worth $1 trillion. By some calculations, 10 percent of that could supply all the gas needs of the United States for two years.
More efficient and economical methods of drilling have allowed exploration at depths of 5,000 to 8,000 feet that were previously out of reach.
Close to 30 drilling companies have set up operations in the commonwealth, snapping up drilling rights on tens of thousands of acres of land
The state is on track to issue a record number of Marcellus permits this year. From Jan. 1 through April 17, the Department of Environmental Protection has issued 2,028 drilling permits, 394 of which are specifically for exploration of the Marcellus shale.

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