The Marcellus and Point Pleasant-Utica Shale plays in the Appalachian Basin contain an estimated mean of 214 trillion cubic feet of undiscovered, technically recoverable continuous resources of natural gas, according to new U.S. Geological Survey assessments.
The latest USGS data is more than 75% higher than the previous USGS study, which estimated the Marcellus held 84 Tcf in 2011, and the Utica in 2012 held a mean of 38 Tcf.
“Watching our estimates for the Marcellus rise from 2 trillion, to 84 trillion, to 97 trillion in under 20 years demonstrates the effects American ingenuity and new technology can have,” said USGS director Jim Reilly.
Cover seven states
The Marcellus, Point Pleasant and Utica cover portions of Kentucky, Maryland, New York State, Ohio, Pennsylvania, Virginia and West Virginia.
Significant amounts of natural gas have been produced from the Marcellus and Utica Shales since the previous USGS assessments. USGS assessments are for remaining resources and exclude known and produced oil and gas.
The natural gas in these formations is classified as continuous, because it is spread throughout the assessed rock layers instead of being concentrated in discrete accumulations. Production techniques like directional drilling and hydraulic fracturing are required to produce these resources.
Development techniques have improved
“Since our assessments in 2011 and 2012, industry has improved upon their development techniques for continuous resources like the shale gas in the Appalachian Basin,” said Walter Guidroz, program coordinator for the USGS Energy Resources Program. “That technological advancement, plus all of the geological information we’ve gained from the last several years of production, have allowed us to greatly expand our understanding of these formations.”
The Marcellus Shale also contains an estimated 1.5 billion barrels of natural gas liquids, while the Point Pleasant-Utica Shale also contains an estimated 1.8 billion barrels of oil and 985 million barrels of natural gas liquids, according to the USGS.
‘Father of the Marcellus’ speaks
The “Father of the Marcellus” told Kallanish Energy he was a bit surprised by the data the USGS released Thursday. “The USGS is inherently conservative (as they should be) when estimating a resource, so that I regard a prediction of 214 Tcf for the Appalachian Basin as rather bold for them,” said Terry Engelder, a retired professor of Geology at Penn State University
In January 2008, Engelder shocked the oil and gas industry worldwide when he and fellow geologist and researcher Gary Lash, a professor at the State University of New York-Fredonia, projected the Marcellus held 168 Tcf of gas, a figure that could be as high as 516 Tcf.
‘A safe bet’
Engelder told Kallanish Energy people forget that in late 2007, the USGS assessment for the Marcellus was less than 3 Tcf. “Their assessment is based on actual production data (the safe bet) which gives less weight to areas with low or no production results,” Engelder said. “I’m not sure how they account for the price of the commodity which, of course, would drive the technology. Their estimate is probably based on a technology developed for $2 gas.”
Engelder added that should gas actually jump “can we speculate that $8 gas will lead to some really creative innovations that will give 214 Tcf a bump?”
The USGS assessments are for undiscovered, technically recoverable resources. Undiscovered resources are those that have been estimated to exist based on geology and other data, but have not yet been proven to exist by drilling or other means.
Technically recoverable resources are those that can be produced using today’s standard industry practices and technology. This is different from reserves, which are those quantities of oil and gas that are currently profitable to produce.