Southwestern Pennsylvania and West Virginia have formed an “integrated region” for natural gas drilling, an area where well drilling increasingly has been focused in the Appalachian Basin, according to the U.S. Energy Information Administration (EIA).

In a report published on Friday, the federal agency noted that rig operators frequently move between the two states. EIA relied on gas-directed drilling rig data from DrillingInfo and used wet/dry gas boundaries determined by Bentek Energy LLC.

“Drilling continues to shift out of the dry region of northeast Pennsylvania, where most natural gas production in the Appalachian Basin’s Marcellus Shale play has occurred,” the report said.

For the week ending Aug. 16, 26 active rigs were drilling gas wells in northeastern Pennsylvania’s dry gas region, versus 43 for the year-ago period, according to Baker Hughes Inc. In the same time period of 2011, 83 rigs were working on dry gas wells.

“The share of natural gas production from the southwestern parts of Pennsylvania has grown, exceeding 2 Bcf/d in February 2013, and as a result, northeastern Pennsylvania’s share of total state production fell from nearly 76% in August 2012 to about 73% in August 2013,” EIA said.

By combining the rig data and wet/gas boundaries in the two states, EIA found that the number of gas-directed wells in the wet regions began to surpass the number of dry gas wells beginning around March 2012. Barclays Capital analysts noted the shift as well (see Shale Daily, May 10, 2012).

In their analysis at the time, Barclays’ Shiyang Wang and Michael Zenker relied on county-level production data and county-level maps of the Marcellus region using company reports where the boundaries of the wet gas/dry gas windows were drawn. The duo classified each county as either wet or dry gas producing based on the boundaries. “It is easy for a producer to designate a particular drilling program as natural gas liquids (NGL)-targeted even if it started as a gas-targeted effort, as NGLs production is clearly more in favor,” wrote the duo.

Barclays used company data to determine that gas production from liquids-rich counties was mostly flat until late 2010/early 2011. Using Barclays methodology, the Marcellus produced on average 175 MMcf/d of associated gas in 2010, which was about 30% higher than in 2009, even though dry gas output over that period nearly tripled. In 2011, associated gas production almost doubled to 334 MMcf/d, while dry gas output jumped 150% from 2010. However, in the first three months of 2012, a “higher growth intensity” finally was recorded for associated gas, with output up 70% year/year, while dry gas output grew by half.

Even with the shift to more wet gas, Barclays analysts in a report earlier this month said the potential for gas production this year from the Marcellus and Utica shales should increase by 3.6 Bcf/d from 2012 and nearly double again in 2014 (see Shale Daily, Aug. 15). Wood Mackenzie said the same in a report issued in July that found that gas production from the Marcellus and Utica shales should double over the next five years, surpassing Rockies output levels from 2012 and accounting for “over a quarter of U.S. Lower 48 gas production” (see Shale Daily, Aug. 1).

The shift to wetter targets since early 2012 has pushed drilling activity “increasingly” from “northern Pennsylvania to southwest Pennsylvania and West Virginia — or from dry to more liquids-rich parts of the Appalachian Basin,” EIA said. Increases have also occurred in the number of oil-directed rigs in this region, particularly in the Utica Shale formation.

Dry gas drilling began to rebound a bit this summer in the two states, but it still doesn’t match the wet gas numbers, according to EIA.