The Marcellus Shale is a gracious host.
It's cheaper to partake in its offerings than in those of other shale plays and, in some cases, investors get twice as much gas for their money as anywhere else. It's so good that traditional ways to calculate its benefits may no longer apply.
Let's take a standard metric: the number of rigs in the ground versus the amount of gas coming out of it.
In Pennsylvania, the rig count has fallen steadily over the past few years. It now hovers just above 85, down from a high of 144 in early 2012. But new gas production has gone drastically in the opposite direction.
During the first quarter of 2014, the amount of gas ascribed to each rig in the Marcellus was 6,476 thousand cubic feet, twice as much as during its rig count peak and two and a half times the average of other shale plays in the U.S.
Part of the credit lies with oil and gas companies that have found quicker and more efficient ways to drill wells.
Efficiencies have moved from the big scale — drilling more than one well per pad, for example — to tweaks that happen underground. The horizontal sections of wells have gotten longer. The number of sections of wells that get fracked has increased, too, while the spaces between those sections has shrunk. And the wells themselves are being drilled closer together.
It now takes, on average, 15 days from start to finish to put a Marcellus well into production, according to Diana Oswald, manager of energy analysis with Colorado-based Bentek. Two years ago, it took twice that long.
Longer horizontal wells are the trend everywhere, not just in the Marcellus. So is tighter spacing and more frack stages per well.
That means part of the Marcellus' disproportionate success lies within the resource itself.
"I think it's a matter of the Marcellus being just so incredibly good that the improvements that are made are extremely apparent," said Greg Wrightstone, a petroleum geologist and founder of Wrightstone Energy Consulting in McCandless.
"In other places, if you see a 20 percent increase, it's not economic," he said.
But if a driller can achieve an analogous improvement in the Marcellus shale, "It makes a really good well incredible."
Still, there are wrinkles with the rig-to-production ratio.
The Marcellus, more than some other shale plays, is constrained by a lack of pipelines. Wells are being drilled faster than pipes are being built to carry gas to market. So many wells remain temporarily shut in.
It's estimated that about 1,000 such wells are awaiting connection to a pipeline in the Marcellus. So even as the rig count drops, the number of already completed wells being connected when infrastructure materializes keeps production growing.
Bill Holland, editor at Gas Daily, a Platts publication, said it's time for a new way to measure productivity, perhaps by pinning gas production to how densely a well is fracked.
"As a generic rule, the connection between rig count and production has been completely destroyed," Mr. Holland declared.
— Anya Litvak: email@example.com or 412-263-1455.
First Published May 13, 2014 11:26 AM