Marcellus (PA) - update until August 2016

This interactive presentation contains the gas (and a little oil) production from horizontal wells in the Marcellus (Pennsylvania). Production until August 2016 is included, from 6939 horizontal wells that started production since 2010. At the end of next month, when Ohio releases its quarterly production data, I will present another update from both these states together. I also aim to add West Virginia to these Appalachia updates, once it releases its 2016 annual production data (it only releases production data annually).

There appears to be a rather big drop in gas production in August. The drop in production can be mostly attributed to a drop in legacy production, as the number of newly producing wells in August (57) was higher than in the couple of months before. I can’t rule out yet that part of the drop can also be explained by incomplete reporting for August.

Turning to the “Well quality” tab, we can see that well productivity of 2016 wells is so far very similar as 2014 & 2015 vintages, on average.

Concerning the number of DUCs in PA: I now removed DUCs that were spud more than 3 years ago. The actual status of those wells is not so clear, and I consider it unlikely that these are brought online any time soon. This action brings my number of DUCs closer to the estimate of the EIA.

Around the mid of next week, I plan another update on the Niobrara basin (CO & WY).

For this presentation, I used data gathered from the following sources:

  • Pennsylvania DEP


The above presentation has many interactive features:

  • You can click through the blocks on the top to see the slides.
  • Each slide has filters that can be set, e.g. to select individual or groups of operators. You can first click “all” to deselect all items. You have to click the “apply” button at the bottom to enforce the changes. After that, click anywhere on the presentation.
  • You can switch between different products (e.g. natural gas, or oil), by using the “Product” selection, present in all tabs.
  • Tooltips are shown by just hovering the mouse over parts of the presentation.
  • You can move the map around, and zoom in/out.
  • By clicking on the legend you can highlight selected items, and include or exclude categories.
  • Note that filters & selections have to be set for each tab separately.
  • The operator who currently owns the well is designated by “operator (current)”. The operator who operated a well in a past month is designated by “operator (actual)”. This distinction is useful when the ownership of a well changed over time.
  • If you have any questions on how to use the interactivity, or how to analyze specific questions, please don’t hesitate to ask.


  • alex says:

    Hi Enno,

    What I love about your data is that we can use the granularity to investigate relationships and make interesting projections. Looking at the well count increase from Aug to Dec for recent years, for example, there is a nice relationship to increased production by year end, which makes total sense.

    2012 – Well count went from 889 in Aug to 1334 in Dec, a 50% increase. Production went from 2,725mmcf/day in Aug to 4,147mmcf/day in Dec, a 52% increase
    2013 – well count increased by 51%, production by 59%
    2014 – well count increased by 71%, production by 73%
    2015 – well count increased by 42%, production by 37%

    So what will well count do from Aug to Dec 2016? I have no idea, so let’s assume it increases between 40-70% (the range set by the previous 4 years), and that production will therefore also increase by 40-70%.
    – at 40% increase, 2016 production in Dec will be 2,333 * 1.4 = 3,266mmcf/day
    – at 70% increase, 2016 production in Dec will be 2,333 * 1.7 = 3,966mmcf/day

    Pre-2016 legacy output from the Marcellus declined by ~3,000mmcf/day between Jan and Aug 2016 (hence we are already ~700mmcf/day down). And the chances of an additional 1,000mmcf/day legacy decline by year end is high, which would give us a total decline of ~4,000mmcf/day during 2016.

    Given the above calcs for 2016 production, it seems that a down year at the Marcellus is entirely possible at this point.

  • Enno says:

    Exactly Alex,

    I’ve employed similar reasoning for a few oil-related projections.

  • jim brooker says:

    I was just looking at EQTs Marcellus well cost for a 9,000′ lateral length it is currently $6.9 MM. Don’t think that includes acreage.’

    What are the getting, a little over a buck for their gas?

    If this isn’t where capital goes to commit suicide, where is it?

    Hope they get those gas fired bunsen burner boilers installed in time to burn the last vestiges of these hmmmm “reserves”.

  • John says:


    Once again you really hit this out of the park.

    Alex, your comment really make my eyes open wide. This is going to be a very interesting segue into 2017.

    I’m trying to get my head around all of the pending midstream projects. How can these projects be financed? How can the necessary volumes be guaranteed?

  • E. Gadsby says:

    Inactive wells rose from 322 to 603, that could be a big contribution to the production drop – possibly some pipeline or other infrastructure issues (gas plant maintenance planned or unplanned)?

    1. Enno says:


      I also noticed that; probably a good part of the explanation indeed.

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