Pa. natural gas production in decline

After the past two years' drop in natural gas drilling in response to lower gas prices, Marcellus Shale gas production has declined for a second straight month, writes analyst Robert L. Christensen Jr. in a report to clients of the Philadelphia-based Drexel Hamilton investment brokerage. 

Less gas will likely mean higher prices by next year, after a couple of years of low prices, Christensen concludes. Gas is a major heating and industrial fuel in the Philadelphia area and other northern metro regions.

Pennsylvania produced 13.2 billion cubic feet a day in April, down from 14 billion in March and nearly 15 billion at its peak in February, Christenson wrote, citing state figures. The state is the nation's second-largest producer of "unconventional" gas recovered by hydraulic fracturing, after Texas, where production is around 22 billion cf/day.

The Inquirer's Andrew Maykuth has documented the decline in Pennsylvania gas drilling after the early 2000s boom, even as Gov. Tom Wolf has tried to impose new gas production fees. The gas boom has enriched Pennsylvania landowners and, for a time, increased gas-company, trucking and support jobs in northern and western counties.

Boosters hope the state's gas development will lead to more permanent  industrial redevelopment, spreading from projects such as Sunoco Logistics' conversion of the former Marcus Hook oil refinery to a gas industrial center, or Shell's plans to build a plastics feedstock factory at a former zinc smelter near Pittsburgh.