The U.S. Energy Information Administration (EIA) said Monday that the Marcellus Shale region is expected to provide 18% of the country's natural gas production in December as more takeaway capacity has come online and operators continue to maximize drilling efficiencies in Pennsylvania and West Virginia.
The revelation comes as part of a highlight from the agency's monthly drilling productivity report, which tracks developments in the Bakken, Eagle Ford and Haynesville shales, as well as the Niobrara formation and Permian Basin.
On track with an earlier projection released last month (see Shale Daily, Nov. 13), natural gas production is expected to surpass 13 Bcf/d in the Marcellus this month and push closer to 14 Bcf/d next month. The EIA said natural gas production in the play will increase by 419 MMcf/d from December to January.
The rig count has remained largely flat throughout much of this year. It dropped by 18 in Pennsylvania this week compared to the same time last year by Baker Hughes’ count. Despite that trend, natural gas production has continually climbed. The Marcellus region produced just 2 Bcf/d as recently as 2010.
Production from new wells continues to grow as operators stack longer laterals and add more frack stages. The EIA's highlight shows that production per rig in the Marcellus will pass a new milestone this month, with each rig averaging a bit more than 6 MMcf/d and projecting rigs will produce nearly 6.2 MMcf/d next month.
Meanwhile, more pipelines and additional processing capabilities have brought shut-in wells online and pushed production higher. The EIA said recent infrastructure upgrades in both Pennsylvania and West Virginia are boosting production and driving the forward price of natural gas at the Columbia Gas Transmission Appalachia hub below Louisiana's benchmark Henry Hub price.
According to NGI's Weekly Gas Price Index, gas was trading at an average of $3.93/Mcf at the Henry Hub last week, and ending the week at over $4.00/MMBtu.
In November, pipeline operators opened the taps on four projects to move gas northeast from the Marcellus (see Shale Daily, Sept. 25). That move added 1.8 Bcf/d to takeaway capacity. Other projects will add a total of 1.99 Bcf/d to Marcellus capacity this winter, according to the EIA.
EIA said natural gas production in the Bakken Shale will increase from 1.09 MMcf/d to 1.11 MMcf/d between December and January, while it will increase from 5.98 MMcf/d to 6.08 MMcf/d during the same time in the Eagle Ford Shale.
The agency also predicts that natural gas production in the Haynesville Shale will decline by just 131 Mcf. Total natural gas production for all six regions will increase from 36.5 Bcf/d to 36.9 Bcf/d and oil production will remain flat at about 3.9 million b/d from this month to next.