Federal report ups Marcellus Shale estimate

Posted August 23, 2011

Pittsburgh Business Times - by Anya Litvak

There is a 40-fold difference between what the United State Geological Survey believed was the potential of the Marcellus Shale a decade ago and what its scientists now know about the rock formation.

Today, USGS released an updated Marcellus estimate of how much gas is in the ground and how likely it is that gas companies can get to it using current technology.

It’s a lot — an average of about 84 trillion cubic feet. Plus, there’s about 3 billion barrels of natural gas liquids in the ground that have a reasonable chance of being recovered. (Look back on the latest production data for southwestern Pennsylvania to see how we fit into these reserve counts).

The USGS arrived at the figure without regard for regulatory and zoning issues — that is, the gas underneath Pittsburgh, which has a ban on Marcellus gas extraction, counts as much as the gas underneath Hopewell Township.

The agency also doesn’t comment on economic feasibility. It doesn’t say this is profitable to drill. It simply says it’s possible.

The USGS’s previous shale gas estimate from 2002 was around 2 tcf of gas and 10 million barrels of natural gas liquids.

Even this new, much much larger estimate is below the 500 trillion cubic feet postulated by Penn State Geologist Terry Engelder who is credited with launching faith in the Marcellus in 2008.

Engelder has said there’s “conservatively” 169 tcf in the Marcellus, but it could be as high as 516 tcf.

According to the USGS’s new paper, the upper limit of what’s recoverable is 144 tcf — that’s using a 5 percent chance of recovery, based on current technology.

The more realistic figure, according to the agency, is the average 84 tcf number, and if we’re using a near definite standard — 95 percent recoverable — it’s actually closer to 43 tcf.

For perspective, the U.S. consumed 24 tcf of natural gas in 2010, according to the Energy Information Administration.

And for even more perspective, USGS scientist James Coleman said he did a quick calculation of Marcellus gas already extracted by adding up the data available on states' production websites (Pennsylvania, West Virginia, Ohio and New York). He arrived at 1.45 tcf stripped from the ground since 2005.