Volume of natural gas production increasing faster than expected, even with fewer new wells [View all]

[JPZenger]

http://thetimes-tribune.com/news/marcellus-shale-gas-growing-faster-than-expected-1.1573158

Excerpt:

"Natural gas production from the Marcellus Shale region is growing faster than expected, according to a new federal report issued Tuesday.

Marcellus production has now reached 12 billion cubic feet a day, the Energy Information Administration report found. That's the energy equivalent of about 2 million barrels of oil a day, and more than six times the 2009 production rate.

The vast majority of the Marcellus gas is coming from Pennsylvania and West Virginia. The shale also lies under other states, but most of the wells in Ohio produce oil, and New York has placed a moratorium on shale gas drilling. Federal energy experts are surprised by the rapid Marcellus growth, since the number of drilling rigs has fallen over the past two years."

----
Fortunately for the gas industry, Corbett and his friends instituted an impact fee instead of an extraction tax. State revenues from the industry may actually decrease in the next few years because of the way the state fee was structured. In comparison, an extraction tax would have raised more revenue as production increased each year. Every other state that has a natural gas industry uses an extraction tax (including Texas, which Corbett said he wants to be a model for PA.)