Marcellus Shale Gas Forecast For Potter County: ‘Guarded

A Texan who has been carefully assessing political, financial and scientific trends had some words of caution for those who assume Marcellus Shale natural gas supplies across Pennsylvania’s northern tier are plentiful and will create an economic boon for decades to come. Geology and the intricacies of international energy politics suggest that a more guarded assessment is appropriate, according to Will Bracket, managing editor of a leading trade publication, Powell Barnett Shale Newsletter.

Potter, Cameron, McKean, Clinton and other northcentral counties will be gas producers — stimulating local economies and creating jobs — but the richer Marcellus Shale deposits are found in the northeastern and southwestern quadrants of Pennsylvania, Bracket said. “According to geologists, these areas have the best subterranean structure, so it’s only natural that the early production will be concentrated there,” he added. Some 90 percent of the Marcellus Shale gas produced so far has come from these five counties (in this order): Bradford, Susquehanna, Tioga, Washington and Greene.

Other counties will continue to see drilling, Bracket said, but the extent of it may hinge on the natural gas marketplace. “Operators are simply not as interested in the marginal areas where the shale is not as thick when gas prices are as low as they have been for the past year or longer,” he explained.

His organization tracks the progress of shale gas plays across the country and has been expanding from its base in the Barnett Shale region of northeastern Texas. Pennsylvania’s shale gas data is scant, Bracket said, since state laws requiring more detailed disclosure only recently took effect. More detailed information will be available in February 2011, he added, when companies who operate in Pennsylvania are required to report their most recent production data.

If demand for natural gas rises, then the bounty which lies beneath much of the state could still fuel economic growth and even prosperity in the more marginal areas, Bracket pointed out.

“We could see greater demand, especially if we start exporting more of our resources in the form of liquified natural gas,” he said.  “Although the lower gas prices have been frustrating to the producers, they do have one silver lining — they are stimulating interest in using gas for electricity production. Power producers have been leery of converting to gas due to fluctuating prices, but they are now taking another look.”

Bracket said he is especially optimistic about the Marcellus, compared to other shale formations across the country. “Natural gas prices have been languishing below $4.00, but the Marcellus is one of the few shale plays that continue to grow. It is being held back by, more than anything, a lack of hydrofracturing crews. The service companies don’t have enough manpower and equipment to meet the demand, and that has slowed the drilling.”

Subscriptions to the Powell Barnett Shale Newsletter are available on the company’s website.