Links at top: Read the report: http://blogs.wvgazette.com/watchdog/CHARLESTON, W.Va. -- Federal government analysts on Monday slashed their estimate of the natural gas reserves in the Marcellus Shale formation, and at least one major producer announced plans to cut in half its expenditures on new gas leases in the wake of dropping prices.
The U.S. Department of Energy cut its estimate of the Marcellus reserves from 410 trillion cubic feet of natural gas to 141 trillion cubic feet, citing better production information that emerges as drilling operations in the region mature and the exclusion of data from the pre-shale area.
"Drilling in the Marcellus accelerated rapidly in 2010 and 2011, so that there is far more information available today than a year ago," said the DOE's Energy Information Administration.
Last summer, a new estimate from the U.S. Geological Survey had caused a stir, because it was both much smaller than the existing EIA numbers and much greater than the previous USGS figures.
The previous USGS figure was about 2 trillion cubic feet, but it was nearly a decade old. New research and more advanced drilling methods led that agency to increase its estimates in a report issued in August 2011.
The EIA number of 141 trillion cubic feet released Monday is within the range -- 43 trillion cubic feet to 144 trillion cubic feet -- of those newer figures published by the USGS. But it is significantly greater than the average USGS figure of 84 trillion cubic feet.
By comparison, the U.S. consumes about 24.1 trillion cubic feet of natural gas per year.
In Monday's preview of its Annual Energy Outlook, due out in April, EIA increased its estimates of cumulative natural gas production between 2010 and 2035 by 7 percent.