Marcellus Shale development in Pennsylvania continued to remain level in February.

Through the first two months of the year, the Pennsylvania Department of Environmental Protection (DEP) issued 664 permits and operators reported drilling 262 wells into the play. That’s compared to 590 permits issued and 300 wells drilled by the same point last year.

While permits were up, the number of wells drilled is down, showing the first signs of the cutbacks across the natural gas industry, where companies are content to produce from their earliest wells, while continuing to expand into neighboring counties that saw limited activity during the initial years of the boom.

For the first time, Lycoming County, which is located in northeastern Pennsylvania, led development with 43 wells and 124 permits, compared to 27 wells and 57 permits through February 2011. The most active operator in the county is Anadarko Petroleum Corp. (21 wells) followed by Pennsylvania General Energy Co LLC (nine wells) and Seneca Resources Corp (five wells).

Anadarko plans to cut its Marcellus rig count from 21 to 13 this year as it focuses its resources on more liquids-rich shale plays in its portfolio (see Shale Daily, March 14).

On the production front, production from Lycoming has increased from 11.5 Bcfe in the second half of 2010, to 34.5 Bcfe during the second half of 2011, according to the DEP.

The historic frontrunner in the state, Bradford County, had only 40 wells and 98 permits through the end of this February, compared to 75 wells and 143 permits by the same point last year. Chesapeake Energy Corp. drilled 20 wells in Bradford through the end of February, Talisman Energy Corp. drilled nine and Southwestern Energy Inc. drilled seven.

Production from Bradford has been growing quite steadily, from 65.8 Bcfe during 2H10 to 170.3 Bcfe during 2H11.

Tioga County, historically the second-most active county, also saw a drop through February 2012 to 28 wells and 67 permits, compared to 60 wells and 98 permits at the same point in 2011. But Susquehanna County saw a big jump to 32 wells and 72 permits through February 2012, up from 21 wells and 19 permits through the first two months of 2011.

Tioga’s production rose from 38.4 Bcfe in 2H10 to 65.9 Bcfe during 2H11.

Drillers in northeastern Pennsylvania are expected to reel in development in months ahead, according to a recent analysis by Bentek Energy LLC (see Shale Daily, Feb. 22).

In the wet-gas corridor of southwestern Pennsylvania, where the current price environment is not having as detrimental an effect on development plans as in the northeast, activity is showing companies ramping up permitting efforts in anticipation of future liquids drilling.

In Washington County, the core of regional activities, the DEP issued 60 permits and operators drilled 31 wells through February, compared to 28 permits and 34 wells through the first two months of 2011. Range Resources Corp. drilled 19 wells and Consol Energy Inc., through its subsidiary CNX Gas Co, LLC, drilled 12 wells through February 2012.

Washington County’s 38.6 Bcfe during 2H10 grew to 70.1 Bcfe during 2H11.

Westmoreland County saw a similar trend with 49 permits and 15 wells through February 2012, compared to 16 permits and 16 wells by the same point last year. Chevron Corp. and the Williams-subsidiary WPX Energy are the most active players in Westmoreland.

Westmoreland’s 2H10 production of 4.4 Bcfe during 2H10 increased to 15.1 Bcfe during 2H11.

Activity stayed level in neighboring Greene County, which saw 22 permits and 18 wells, compared to 29 permits and seven wells in 2011, and in Butler County, which saw 30 permits and 13 wells through February, compared to 38 permits and seven wells last year.

In central Pennsylvania, the DEP issued 46 permits in Clearfield County through February, compared to 16 by February 2011. Of those, 27 went to EOG Resources Inc. But drilling is down in Clearfield year over year from 11 wells in February 2011 to two wells this year.

Clearfield’s production doubled from the 3.4 Bcfe during 2H10 to 6.8 Bcfe during 2H11.