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Drilling slows for Marcellus dry gas, picks up for wet gas

By , - Last modified: November 27, 2012 at 9:39 AM

Drilling activity is slowing down in the Marcellus Shale's “dry-gas” regions but is picking up in the Utica Shale, where the rig count has doubled, according to new information from the U.S. Energy Information Administration.

There were 88 active rigs in the Marcellus region in the last week of October, down by 53 compared with a year ago, the EIA said last week, citing data from Baker Hughes, a multinational drilling services company based in Houston.

"The decrease … only appears to be occurring for regions of the state that produce dry gas," the agency said. Dry gas consists almost entirely of methane, in contrast with wet gas, which is rich in components such as ethane, propane and butane.

In Pennsylvania's dry-gas region, the north and northeast, the rig count fell by 56. However, the rig count rose in the state's southwest wet-gas region, the EIA said.

The shift has been ongoing for some time and is driven by economics: The glut of shale gas has knocked natural-gas prices to historic lows, while wet-gas byproducts can be separated out and sold at a premium.

Though the Marcellus rig count dropped, average natural-gas production rose by 72 percent year-on-year, the agency said. The Marcellus produced 6.8 billion cubic feet per day of gas in October, 26 percent of U.S. shale gas production, the EIA said.

In Ohio's Utica Shale, there were 26 drilling rigs in the third week of November, compared with 13 a year ago, Baker Hughes said. The Utica's natural-gas production averaged 7 million cubic feet per day in 2011, according to the Ohio Department of Natural Resources; figures for 2012 were not available.

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