US Geological Survey Estimates Utica Shale Holds Enormous Reserves Of Natural Gas & Oil
Although the Marcellus Shale is the current drilling target for natural gas, and is considered to be one of the largest deposits in the world, there is yet another rock unit with enormous potential named the "Utica Shale," and it is only a few thousand feet below the Marcellus. It will be more expensive and difficult getting to those new deposits because of the thousands of additional feet it will take in drilling to reach Utica's natural gas. But, according to recent findings from the US Geological Service, (USGS) it will be well worth the effort.
When the yield of Marcellus Shale wells start to decline, the USGS estimates there is approximately 38 Trillion Cubic Feet of natural gas waiting for drilling companies to extract an keep a continuing stream of NG for many years to come. Plus, there is an estimated 940 million barrels of oil and 9 million barrels of natural gas liquid by-products like propane and ethane.
The USGS released its report
this past Friday and it shows the Utica Shale covers from West Virginia, Virginia, Ohio, Pennsylvania Maryland and New York. Drillers are just beginning to tap into the deeper Utica. To date, Pennsylvania and Ohio have issued 452 Utica well permits and 178 wells have been drilled, according to the most recent state data. Information on permits for West Virginia, Kentucky, Maryland and Virginia were not readily available.
Steve Ford, VP of the Marcellus Shale Coalition Group stated, "As more (Utica) wells are drilled and more production data is assessed, reserve figures will likely increase," Forde hailed the Utica as "another game-changing opportunity."
The Coal Industry Doesn't Need Another Game Changing Opportunity
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As one old saying goes, "One mans death is another man's profit." This boom for the natural gas industry, may spell additional doom for the staggering coal industry that doesn't need another knockout punch to its already decline in production and lost jobs. All reportedly due to the natural gas industries growth in providing a cleaner, safer and cheaper method to produce electricity.
Compile the EPA's strict regulation and accusations that Obama has declared war against coal, this longstanding and historical industry may just be on its way into extinction.
There have been times before when coal's demise has been prematurely predicted, most notably in the 1980s. This time though, people like renowned University of California's fossil fuel expert, David Victor says it is different. "Coal is on the way out because of the EPA, new regulations and natural gas. We could see coal down at 15 or 20 percent of electric supply over the next decade, that would be a huge change in an industry that historically has relied on coal for 50 percent or more of the electric supply."
According to Arch Coal Company President and CEO John W. Eaves. "Current market pressures and a challenging regulatory environment have pushed coal consumption in the United States to a 20-year low." These job losses come as utilities increasingly switch from coal to natural gas, which has become cheaper as supplies grow.
Natural Gas --VS- Coal
Up until recently, coal supplied 50% of the nations electricity. In 2012, reports show coal and natural gas are equal in their use to produce power. Experts predict that the need for coal will drop to 40% by the end of this year and 30% by the end of the decade. Coal generation decreased 29 billion-kilowatt hours from March 2011 to March 2012, while natural gas generation increased 27 billion-kilowatt hours during the same time period.
Natural gas prices were near 10-year lows this winter, causing some states such as Ohio and Pennsylvania to increase their dispatch of natural gas-fired plants. Newer vintage natural gas-fired units operate at higher efficiency than older, fossil-fired units, which increases the competitiveness of natural gas relative to coal. While natural gas production is on the increase and states are building more and more natural gas fired power plants, coal mines are laying off workers and shutting down coal mines as utilities increasingly switch from coal to natural gas.
According to statistics, gas exploration and production is cheaper, safer and less destructive to the land, (such as strip mining-mountain top removal) it is also more environmentally friendly. According to the Government Accountability Office, power plants that burn coal produce more than 90 times as much sulfur dioxide, five times as much nitrogen oxide and twice as much carbon dioxide as those that run on natural gas do. Sulfur dioxide causes acid rain; nitrogen oxides cause smog; and carbon dioxide is a so-called greenhouse gas that traps heat in the atmosphere.
Utica's Net Worth
According to an article written by Russ Zimmer with the Coshocton Tribune in Ohio, "At Friday's prices for oil and gas, the USGS believes the Utica Shale contains would be worth about $214 billion. The natural liquids, depending on their exact makeup, could be worth several billion more. To extract these vast amounts, the USGS estimates it would take 110,000 wells in the gas window and another 17,500 wells in the oil window."
I am the publisher of an online news website and blog covering local, state and national news since 2007. Author of 4 cold-case murder books in the "Who Killed?" series published by Rooftop Publishing Company. Retired from mainstream media in 2007 (more...