On May 31, the Independent Fiscal Office released its first quarter 2023 report on unconventional shale gas production in Pennsylvania showing quarterly production is down 118 billion cubic feet since the fourth quarter peak in 2021.

Shale gas production peaked in Pennsylvania during the fourth quarter of 2021 at 1,956 billion cubic feet.  The IFO reported first quarter production in 2023 was 1,838 billion cubic feet.

The first quarter of 2023 represented the fifth consecutive quarter with no year-over-year increase in production, in fact there was a 0.7 percent decrease.

During the spike in natural gas prices in 2022 caused by international market conditions, Pennsylvania production was 1,852 in Q1, 1,852 in Q2, 1,879 in Q3 and 1,856 in Q4-- still significantly below the peak of 1,956 in Q4 of 2021.

The last time shale gas production was this low in Pennsylvania was the fourth quarter of 2020 when it was 1,827 billion cubic feet.

The IFO also reported the average Pennsylvania spot price plunged 45.7 percent in the last year due to “a mild winter and the commensurate increase in inventory throughout the country.”

The current price of $1.59 for Pennsylvania represents the lowest quarterly price since the fourth quarter of 2020, according to the IFO.

[Note: Pennsylvania natural gas prices have been influenced significantly by international markets and Russia’s war on Ukraine. When exports of LNG natural gas were in demand by Europe, prices spiked there and in Pennsylvania. 

[Currently, European natural gas prices have plunged and are now at the lowest levels in over two years. [Read more here]  Pennsylvania prices are following that general trend. ]

“The data show that Pennsylvania was the only state to record a production decline in 2023 Q1 compared to the prior year,” according to the IFO.

“Pennsylvania and Ohio were the only states to record a decline in annual production for 2022,” according to the IFO.

“There were 120 new horizontal wells spud, a decrease of 27 new wells (-18.4 percent) from the prior year.

“After solid drilling gains in late 2021 and early 2022, there has been a significant slowdown.

“Preliminary data for April and May 2023 show that new wells spud declined 51.1 percent from the same period in 2022.”

[Note: Baker Hughes reports the number of natural gas drill rigs working in Pennsylvania has increased from 19 in January 2022 to a steady 24 or 25 during May 2023.]

The IFO explains the report only covers unconventional shale gas production and not production from conventional gas wells because unconventional wells account for “over 99 percent of total [natural gas] production” in Pennsylvania.

Click Here for a copy of the report.

PA Oil & Gas Public Notice Dashboards:

-- DEP Moves To Enforce Order To Plug 4 Abandoned Conventional Gas Wells Leaking Methane In Allegheny County Owned By Michael Harju & Economy Natural Gas, Inc.  [PaEN]

-- Pennsylvania Oil & Gas Weekly Compliance Dashboard - May 27 to June 2 -- Conventional Operators Fail To Start Plugging, Fail To Cleanup Spills; More NOVs For Abandoning Wells  [PaEN]

-- PA Oil & Gas Industrial Facilities: Permit Notices/Opportunities To Comment - June 3   [PaEN]

-- DEP Posts 59 Pages Of Permit-Related Notices In June 3 PA Bulletin  [PaEN]

NewsClips:

-- PA Capital-Star: Lawmakers Are Clawing Back State’s Power To Prevent The Abandonment Of Conventional Oil/Gas Wells

-- Warren Times Guest Essay: Simple Truth - Conventional Oil/Gas Well Operators Frequently Abandoned Their Wells, Better Bonding Is A Solution To This Ever-Growing Problem - By Sierra Club

-- Observer-Reporter: Environmental Groups Seek Results Of Pitt Health Studies On Impact Of Natural Gas Development

-- Post-Gazette-Megan Tomasic: Elizabeth Twp. Residents Concerned About Planned Shale Gas Drilling Well Pad Near High School In Allegheny County

-- Warren Times: Environmental Group Announces PA General Energy To Plug Gas Well Proposed As Oil/Gas Wastewater Injection Well In Indiana County  [Read more here]

Related Articles This Week:

-- Independent Fiscal Office Reports PA Natural Gas Production Peaked In 4th Quarter 2021 [PaEN]

-- UPDATED: Susquehanna River Basin Low Stream Flows Trigger SRBC Water Withdrawal Restrictions On 49 Oil & Gas Drilling Operations & Other Water Users  [PaEN]

-- DEP Citizens Advisory Council Meets June 13 To Hear Acting DEP Secretary Negrin Outline His Vision For Changing DEP; Enforcement, Customer Service Strategies; Permit Review Changes; Environmental Justice Plans; More  [PaEN]

[Posted: May 31, 2023]

6/5/2023