Natural Gas From The Marcellus To Octuple (8X) Current Production -- Part I

Active rigs: 186

RBN Energy: Another must-read essay on ethane production coming out of the Marcellus/Utica. I simply cannot "get may arms around" the energy revolution in this country, or more accurately, North America. I already thought we were pretty much awash in natural gas, and that there was already a lot of ethane rejection, but then to read this in the first paragraph:

Over the next three years, the production of natural gas liquids (NGLs) from the Marcellus/Utica could octuple (8X) to more than 650 Mb/d.  Nothing like that has ever happened in the NGL business before.  It has already started.  Last month MarkWest officially inaugurated the Appalachian ethane business. From 5 Mb/d today we could see 200 Mb/d by this time next year if the economics to move that much ethane made sense.  But they won’t.  Because there is nowhere for the additional ethane to go.  Already up to 250 Mb/d of U.S. ethane is being rejected – pushed back into natural gas in the Rockies, Midcontinent, and other regions.  That number will be getting a lot bigger.  Today we will begin an examination of the ethane tsunami and what it means for NGL markets in the Northeast and in the center of the NGL universe – Mont Belvieu, TX.

There must be a dozen dozen story lines in that paragraph, and the RBN Energy folks discuss many of them. But they didn't mention the impact on the Bakken, at least directly, as far as I could tell.  Again:

Already up to 250 Mb/d of U.S. ethane is being rejected – pushed back into natural gas in the Rockies, Midcontinent, and other regions.  That number will be getting a lot bigger.

It certainly makes it more difficult to see the economics bringing on additional natural gas gathering and processing plants in North Dakota. Maybe that's the reason we haven't seen more activity in this area.

Unrelated, but it almost makes the discussion in New York state on whether to allow fracking moot.

Here in Texas, it sounds like the folks in Dallas don't even want to see any more natural gas drilling inside the city. And from what I can see, the natural gas tsunami is yet to hit.

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I thought it was very, very lucrative for oil companies in the Mideast. Maybe not. Rigzone is reporting (Reuters):

Iraq has offered investors more lucrative terms to tap a large oilfield and build a refinery, while blaming Royal Dutch Shell for underproducing billions of dollars' worth of crude.

The Nasiriya oilfield holds reserves of more than 4 billion barrels and could contribute to Baghdad's plan to treble output by the end of this decade with the help of foreign companies.

But Iraq's output has slowed this year and companies have complained about their slim margins on existing service contracts. Some have angered Baghdad by signing contracts with the semi-autonomous northern Kurdistan region in search of better terms.