Unconventional natural gas production is proving to be more durable than many people expected, officials said as the Potential Gas Committee released its 2014 yearend report indicating that the US has a record 2,515 tcf technically recoverable gas resource base.
They said the 131-tcf increase from yearend 2012 came from reevaluations of onshore shale gas resources in the Atlantic, Midcontinent, Gulf Coast, and Rocky Mountain areas, and conventional and tight gas resources in the Midcontinent and the Rockies. The growth was in addition to 53 tcf of US-marketed gas production the US Energy Information Administration estimated for the 2 years since the PGC’s last assessment.
“We have never seen any reason to back down on our numbers,” said John B. Curtis, a professor emeritus at the Colorado School of Mines geology and geological engineering department, and director of the school’s Potential Gas Agency, which provides guidance and technical assistance to the PGC.
“Wells are being drilled and gas is being produced, even in this low-price environment,” he told reporters during an Apr. 8 briefing at the American Gas Association where the report was released. “Of the 2 years, drilling didn’t start to slow down until the latter half of 2014. If there’s any long-term impact, it will show up in the next report.”
Of the 2014 yearend technically recoverable gas resource base, nearly 2,357 tcf was “traditional” resources and 158 tcf was coalbed methane. The addition of 338.3 tcf of proved dry gas reserves EIA estimated at yearend 2013 brought the nation’s future gas supply to 2,853 tcf at yearend 2014, PGC said.
Shale gas growth
Shale gas’s share within the traditional resources category was 616 tcf in 2008, 687 tcf in 2010, 1,073 tcf in 2012, and 1,253 tcf in 2014. “I’ve been listening to shale gas nay-sayers for 10 years, when US production was less than 50 bcfd,” said Christopher B. McGill, AGA’s vice-president for policy analysis. “Today, we produce 72 bcfd of dry gas from shale—and it’s often at increasingly lower costs.”
Curtis said, “Geology is the key. Each formation is different. Operators also have found ways to prolong production as they’re drilled more wells.” He said PGC will consider shale gas a speculative resource if a well hasn’t been drilled into the formation and gas produced from it. “Once it producers, the field can move into the ‘possible resources’ category or, if it’s associated with a nearby producing field, into ‘probable resources,’” he said.
McGill added, “It also has to do with the size of the reservoir, such as the Marcellus shale, which underlies several states.”
There may be still more US shale gas potential from deeper formations, Curtis said. “The Eastern Gas Shales Project in the 1970s didn’t even look at the Marcellus because it was considered too deep and too difficult to produce from,” he said. “Now, the Hanna basin in Wyoming has sediments at 30,000 ft which may have potential. Only a few wells have been drilled there, and none are producing.”
US coalbed methane resources, which at one time represented 10% of total US gas productivity, have fallen to about 2% as they came in at 158.1 tcf at yearend 2014, the report said. “Gas hydrates may be the next possible gas resource,” said Curtis. “They are abundant, but costly to produce. Still, they’re of interest to countries like Japan which are resource-poor but financially and technically strong.”
Founded in 1964, PGC celebrated its 50th anniversary last year with more than 100 geoscientist and petroleum engineering volunteers who produce assessments of the US technically recoverable gas resource base every 2 years. The assessments do not consider whether resources will be developed, but attempt to show they exist and could be developed if needed and adequate price/cost relationships exist, the committee said.
“We don’t do crude oil, but have been asked to track natural gas liquids,” Curtis said. “We’re considering it, but we would need to recruit people from companies and develop the right methodology first.”
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