|
By Bob Weaver
West Virginia's natural gas boom has settled into a lull, with many workers now unemployed.
Gas booms have always come and gone.
A further causality of the Marcellus and Utica boom has has been West Virginia's independent gas producers. They're dead in the water with the big corporations.
So much gas has been extracted, a glut has caused natural gas prices to plummet, no profitability.
There does appear to be profitability with the construction of large diameter transmission lines with compressor stations to pump the gas to metro areas.
In the case of the proposed Mountaineer Xpress line and compressor stations, one of which could be located in Calhoun, the development would push gas to the Gulf of Mexico.
"In a glutted industry in which natural gas prices are plunging as record amounts of unused gas build up in storage, it is a problem," the State Journal reported.
"Since EQT finished drilling the gusher in July, its shares have lost 29 percent, while U.S. natural gas prices have fallen 24 percent."
EQT has announced plans to invest $820 million for well development, drilling 72 Marcellus wells in 2016, a reduction from 122 wells and a $1.9 billion investment the company planned.
The controversial horizontally drilled wells into Marcellus and Utica Shale formations mean greater production with fewer holes.
"Unconventional wells (horizontally drilled) can produce twice as much in one day as conventional wells (vertically drilled) can produce in a year," said Corky DeMarco, executive director of the West Virginia Oil and Natural Gas Association.
The slumping prices in natural gas and the decline in demand for West Virginia coal is strangling the WV budget, highly dependent on taxes from extraction of natural resources.
Natural gas severance tax collections peaked at $161 million in fiscal year 2014, and then fell to $137 million last year.
The U.S. Energy Information Administration says natural gas storage inventories are at record levels and a warmer-than-normal winter "could limit withdrawals in the coming months."
The long touted political talking point about the USA not being energy independent has lost its drama, the national now energy independent, moving from an importer to an exporter.
| 
