EIA: Marcellus Boom Slashes Northeast Natgas Prices
Thursday, July 26, 2012
The U.S. Energy Information Administration (EIA) said surging Marcellus production has cut spot prices in Pennsylvania below the industry benchmark, Henry Hub in Louisiana, making Pennsylvania gas the cheapest in the nation.
It said Marcellus production has doubled since June 2011 to almost 6 Bcfd (170 x 106 m3/day) and comprises 9% of overall U.S. dry gas production.
EIA said the Marcellus growth has surpassed available take-away pipeline capacity in northern Pennsylvania, prompting interstate pipelines to add nearly 1.5 Bcfd (42 x 106 m3/day) of capacity last year. It said many additional pipeline projects have been proposed or are in various stages of completion.
Bentek Energy estimates that more than 1000 gas wells have been drilled in northern Pennsylvania but are not flowing because of insufficient interstate and gathering pipeline infrastructure.
The boom also has expanded demand for compression and gas processing, EIA said.
For more information: www.eia.gov