Friday, November 06, 2015
Prolific natural gas wells in the Utica region are helping drillers in the eastern U.S. survive the worst price collapse in three years.
While producers are choking back gas flows across the U.S., explorers in the Utica are cutting costs and boosting output to increase profits. EQT Corp.’s return from one of the “monster wells” there may reach 47 percent, four times the average in the neighboring Marcellus Shale, according to consultant Bentek Energy LLC.
Output in the Utica, which stretches from Ohio to New York, is “becoming more economic, even in an environment when it’s $2 gas,” said Luke Jackson, an analyst for Denver, Colorado-based Bentek Energy LLC.
U.S. gas suppliers have become more resilient in response to sinking prices that are on pace to average the least this year since 1999. The added production from the Utica threatens to prolong a nationwide glut of the power-plant fuel and keep prices low. Production there may continue to gain at a gas price as low as $1.69 per million British thermal units, according to Bloomberg New Energy Finance.
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