Monday -- April 6, 2015; Another Look At The Incredible Potential Of The Marcellus / Utica

Updates

Later, 1:56 p.m. CT: a reader sent a nice 30-second sound bite / several data points that puts the Marcellus into perspective.  See first comment below. I brought the note up here so it is google-searchable.

A few data points conveying the size of the Marcellus and Utica resources:

Largest producing well in the Marcellus - Cabot's T Flower 2 - has produced over 13 billion cubic feet of gas in two years, 745 days of production averaging 17,712 MCF/day.
In oil-equivalent terms, this well, in two years, has produced over 2,200,000 boe at almost 3,000 boe/day.

The EIA just described the Marcellus play as covering 72,000 square miles ... an area slightly larger than the entire state of North Dakota.

The underlying Utica formation is significantly larger than the Marcellus in area, with a WAY thicker payzone.

One well, producing over 2.2 million boe in two years is, to say the least, astonishing. 

Original Post
Active rigs:

	4/6/2015	04/06/2014	04/06/2013	04/06/2012	04/06/2011
Active Rigs	94	192	187	208	171

RBN Energy: MarkWest’s Innovative Marcellus/Utica NGL ‘Machine’

Natural gas processing in the Marcellus and Utica plays has quickly become a much larger—and more complex—business as major players race to keep up with fast-rising capacity needs and to ensure that the various elements of their infrastructure operate as an integrated, well-oiled “machine.” And, in a region with only minimal NGL storage capacity, one of that machine’s most important characteristics must be an ability to deal with all the “what-ifs” that could otherwise lead to logistical chaos, particularly those issues dealing with ethane. Today, we continue our in-depth review of Marcellus/Utica NGL infrastructure with a look at MarkWest’s innovative NGL network and distributed de-ethanization system.

In one of the most memorable TV scenes ever, Lucy Ricardo and Ethel Mertz, working as candy-factory wrappers in an episode of “I Love Lucy”, struggle as the conveyor belt accelerates, sending more and more chocolates their way.  They cope (barely) through ingenuity (stuffing the candies they can’t handle in their mouths or storing them in their hats). MarkWest Energy Partners, which runs the largest natural gas processing and NGL-fractionation operation in the Marcellus/Utica, has been developing a far more elegant—and long-lasting—solution to dealing with the ever-increasing pace of gas and NGL production in that region. Most important, perhaps, MarkWest is building into its NGL network ways to mitigate the risks associated with producing NGLs in a region with next-to-no NGL storage capacity. That is particularly important for handling ethane, which is by far the most difficult NGL to handle when there are effectively no storage options.

As we said in Episode 1 of our series, in Mont Belvieu, TX, the center of the NGL/fractionation world, there’s plenty of storage to absorb infrastructure disruptions (like ethane-consuming ethylene crackers going offline or pipelines tripping off due to mechanical problems). But when similar disruptions hit the storage-challenged Marcellus/Utica (the January 2015 rupture of Enterprise Products Partners’ ATEX pipeline, which carries ethane from the Marcellus/Utica to Mont Belvieu, comes to mind) midstream companies need other ways to deal with all the NGLs still “coming down the conveyor belt.” In Episode 2, we described the Marcellus/Utica region in more detail; in Episode 3 we discussed the eight major pipelines that move natural gas through and out of the region; and in Episode 4 and Episode 5 we considered the gas processing plants, de-ethanizers and C3+ fractionation facilities MarkWest has been developing. (For more on what de-ethanizers and C3+ plants do, see Episode 5.)

Today we’ll describe MarkWest’s innovative approach for integrating this infrastructure to handle the difficult issue of high-volume ethane production in a region with no ethane storage – and eventually to handle the requirement of petchem companies planning to build one or more ethane-based world-scale steam crackers in the region.