SALEM, Ohio — The Utica and Marcellus shale plays are considered to be young oil and gas plays, but there is little doubt that the plays’ production is significant.
Will Brackett, the managing editor for the Powell Shale Digest, spoke about how the two plays stack up against others in the United States in a recent webinar produced by Penn State.
Gas production records
As of June 15, according to the U.S. Energy Information Agency, the Marcellus shale play produced 16.48 Bcf per day, which makes it the largest gas-producing area in the country.
The Eagle Ford was behind the Marcellus shale with 7.18 Bcf. The Utica was seventh on the list of eight with a reported production of 2.60 Bcf per day.
Growing play
Brackett said it is clear the Marcellus and Utica are going to grow to be perhaps the largest producing plays.
The U.S. EIA reported the Marcellus and Utica is responsible for 85 percent of the gas production since 2012.
“The Appalachian basin with the Marcellus and Utica shale is going to be center of the shale production here in the United States, at least the rest of this century and for a long time to come,” said Brackett.
Production challenges
Although the Marcellus and Utica may be productive, there are challenges to getting the oil and gas products — challenges that other plays like the Eagle Ford or Barnett don’t have.
Some challenges are unique to the Appalachian region. Operators are unfamiliar with the Appalachian region and the residents of the Appalachian region are not familiar with how the oil and gas industry works.
Learning curve
Brackett said oil and gas companies have had to learn how to drill in the Appalachian region. The operators had to learn the geography and geology, which has delayed the process in the Appalachian region.
Another challenge has been educating people living in the Appalachian region about the oil and gas industry.
This meant launching a constant public relations campaign, from the start of leasing to the construction of pipelines. Landowners and residents have had to learn how the leasing process works, what dangers there are to drilling and fracking, and companies have had to earn public support for pipeline construction.
Workforce
Limited labor and a skilled workforce has also slowed drilling in the Marcellus and Utica shale. Brackett said there simply wasn’t a workforce in the area to start drilling and oil and gas companies had to bring workers from areas that have already been drilled.
The lack of a workforce, however, has also created opportunities for the region’s educational systems, as many high schools, technical schools and colleges have started oil and gas programs so they can producers workers from the area with the knowledge needed to do the oil and gas jobs.
Drilling equipment
Other trials have been the lack of needed equipment in the area and a lack of midstream infrastructure. Oil and gas companies have had to re-route rigs or get equipment hauled in from the South.
It has also meant the construction of pipelines and other processing equipment in order to get the oil and gas to the marketplace.
However, even with the challenges, Brackett said the data is clear that the Marcellus is the largest shale gas play over the long term.
Gas markets
Although there are quite a few challenges in the Marcellus and Utica shale, there are advantages to the play as well.
One is the location of the oil and gas play: It’s near the largest natural gas markets on the Eastern Seaboard that get tromped on during winter and are large consumers of natural gas.
Another advantage has been the availability of acreage. Oil and gas companies were able to enter the play and secure acreage because most had not been leased before the shales hit.
Natural gas liquids
Brackett said the availability of liquids or NGL condensate, and the geology in the play make it easy for companies to drill and offer different products to the marketplace.
The NGLs are important because it means oil and gas companies have more to market than just natural gas and oil.
Cheap drilling
Other advantages to the Marcellus and Utica shale play includes the pricetag attached to the wells.
Drillers found they could drill wells cheaper in the Appalachian region than in other shale plays. There have also been bigger wells, which meant a lower cost to drill per well because the play has more sweet spots.
“It’s bigger than what was expected just a few years ago,” said Brackett.
He added that some wells in Susquehanna County, which is located in northeastern Pennsylvania, have produced 1 billion cubic feet in six months.
Utica disappointment
Brackett said the Utica was initially billed to be an oil play comparable to the Eagle Ford, however that has proven to be wrong. He said geologists discovered the oil window has been too shallow, which limits pressure to push the crude oil out.
He said the Utica shale play is young, compared to others, and given time it may rival what the dry gas wells in the Marcellus are producing on a daily basis.
