reserves

Once Burned, Twice Shy? Utica Shale Touted to Investors As Shale Drillers Continue Posting Losses

Read time: 7 mins

For the past several weeks, the drilling industry — hammered by bad financial results — has begun promoting its next big thing: the Utica shale, generating the sort of headlines you might have seen five years ago, when the shale drilling rush was gaining speed. “Utica Shale Holds 20 Times More Gas Than Previous Estimates”, read one headline. “Utica Bigger Than Marcellus”, proclaimed another.

Deepening Doubts About Fracked Shale Gas Wells' Long Term Prospects

Read time: 7 mins

This month, the Pennsylvania Department of Environmental Protection released its bi-annual report on how much natural gas has been produced in the Marcellus Shale, a rock formation which stretches underneath much of Appalachia. Investors were shocked because the production numbers seemed far lower than expected.  Watched closely by market and energy analysts, the report sparked a heated debate about the oil and gas industry's excited rhetoric about fracked shale gas as the cure-all to many of America's energy and jobs needs.

But the story quickly got complicated. The report was released despite lacking data from the state’s second largest driller, Chesapeake Energy, and state regulators never flagged the omission. The amount of gas flowing out of Pennsylvania had actually climbed dramatically.

It was a major flaw, and suddenly the searing spotlight of the media honed in on questions about whether regulators were keeping accurate track of how much gas the wells in their state really produce. How could they overlook such a massive error? Can the public be sure that the updated tally gives an accurate picture of how these wells are performing?

If regulators make mistakes in tracking energy production in their state, how reliable is the companion to that report, which tracks the toxic waste produced by these same companies?

Those are all valid questions that need honest answers. But the most important questions raised in the controversy were largely overlooked.

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