02/05/2017
Why did the WV Legislature reduce the severance tax when WVF Gas production has increased each year since 2004?
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May 2, 2017 | Today's Paper | Submit News | Subscribe Today
Marcellus and Utica Production Still Climbing in Ohio and West Virginia
TOP HEADLINES
MAY 1, 2017
CASEY JUNKINS
Business/Energy Writer
[email protected]
Photo by Casey Junkins
Contractors continue building natural gas pipelines in Belmont County.
Photo by Casey Junkins Contractors continue building natural gas pipelines in Belmont County.
WHEELING — While the rest of the U.S. saw natural gas production fall in 2016, Ohio, West Virginia and Pennsylvania combined to increase output by 2.5 billion cubic feet per day last year.
That much natural gas is enough fuel to power more than 60,000 homes for an entire year — if it can get to the region with the highest demand for electricity generation: the Eastern Seaboard.
A new report from the U.S. Chamber of Commerce shows the “Keep it in the Ground” environmentalist movement is preventing states such as New York, New Jersey, Connecticut, Massachusetts, Rhode Island, New Hampshire, Vermont and Maine from gaining the benefit of this natural gas. Moreover, the group’s efforts to stop pipeline construction hinders the ability of Ohio and West Virginia to realize the full economic growth the industry could provide, the study suggests.
“Environmental groups seeking to ‘keep it in the ground’ are fighting to block virtually every project that would bring additional natural gas into the Northeast,” Karen Harbert, president and CEO of the chamber’s Energy Institute, said. “As a result, residents in the Northeast are paying the highest electricity rates in the continental United States, with no relief in sight if infrastructure is not built.”
U.S. producers pumped an average of 77 billion cubic feet of natural gas in 2016, which is down from the national record of 79 billion cubic feet per day in 2015.
Texas, which still produces more natural gas than any other state, saw daily yields fall by 2.5 billion cubic feet.
However, even as the number of active drilling rigs remains relatively low, production levels continue climbing in Ohio, West Virginia and Pennsylvania. Ohio and Pennsylvania each saw production grow last year by 1.2 billion cubic feet per day, while West Virginia’s yield grew by 100 million cubic feet per day.
According to EIA, Pennsylvania and Ohio now account for 24 percent of all U.S. natural gas production. This is up from just 2 percent in 2006.
“The increased productivity of natural gas wells in the Marcellus Shale and Utica Shale is a result of ongoing improvements in precision and efficiency of horizontal drilling and hydraulic fracturing occurring in these regions,” the EIA states.
Although West Virginia’s increase is smaller than that of its neighbors, the Mountain State grew its production for a 13th straight year in 2016, the agency added.
One company with significant operations in West Virginia, EQT Corp., continues growing the scope of its operations. Thursday, EQT President and CEO Steve Schlotterbeck said the company added 67,000 acres to its Marcellus development area in the first three months of this year.
“We’ve added more than 220,000 acres in the past 10 months and the benefits of our core consolidation efforts are now being realized through the drilling of longer laterals, which provide operational efficiencies, improve well economics and deliver stronger returns,” he said.
Within the last few months, the Federal Energy Regulatory Commission approved the $4.3 billion Rover Pipeline, while the developer sued to use eminent domain to acquire the land to build the massive conduit that will stretch from Doddridge County, W.Va. to Michigan.
However, environmentatlists with the “Keep it in the Ground” movement continue working to stop pipeline construction.
“Stop digging. No additional fossil fuel development, no exploration for new fossil fuels, no expansion of fossil fuel projects. We need to keep fossil fuels in the ground,” a letter from the organization states.
According to the U.S. chamber, the blocking of pipeline construction in the Northeast is impacting the economic fortunes of Ohio, West Virginia and Pennsylvania. Ohio will miss out on 2,083 jobs, $78.4 million in employee compensation and $294.5 million in gross domestic product by 2020, chamber officials said, while West Virginia would fail to realize 2,518 jobs, $100.2 million in employee compensation and $159 million of gross domestic product.
“As the regulatory and price environment continues to encourage the use of natural gas, northeast states will find themselves increasingly starved of the energy needed to power the economy and keep the lights on,” Harbert said. “Our analysis demonstrates that there is simply not enough capacity to meet demand, and families, consumers and businesses will all pay the price.”
