Sunday, October 21, 2012

Marcellus Shale deposits deeper and cheaper to drill

Don't think that environmental battles over drilling in the Marcellus Shale are likely to end anytime soon. Two new reports show that the supply of natural gas buried in the formation
is not only more plentiful than previously believed but also is less costly to than in any other gas field in the U.S.  

From the
Associated Press: 
The Marcellus could contain "almost half of the current proven natural gas reserves in the U.S," a report from Standard & Poor's issued this week said. 
Another recent report from ITG Investment Research, a worldwide financial firm based in New York, found that a detailed analysis of Marcellus well production data suggested that federal government estimates of its reserves "are grossly understated."  
The new information increases the likelihood that natural gas will be used for more and more energy needs, such as city buses, industrial use, and electric power generation, according to Manuj Nikhanj, the head of Energy Research at ITG. 
And though low wholesale prices have squeezed drilling companies' revenue, the S&P report says the Marcellus has the lowest production cost of any natural gas field in the nation, adding to the likelihood of a continued boom
"The amount of resource that's available at relatively low cost is fairly enormous," Nikhanj said. 
The Marcellus is a gas-rich formation thousands of feet below much of the four states, but current production is centered in Pennsylvania and West Virginia

From the Standard & Poor's report

Related environmental news stories:
Reports: Marcellus reserves larger than expected 
How the Marcellus Shale is changing he dynamics of the U.S. energy industry

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