West Virginia’s natural gas industry continues to thrive and to contribute to the state’s economy: That’s the message of a report released this week by GO-WV, the Gas and Oil Association of West Virginia.
The annual report, Gas Facts, says natural gas production increased by more than 14 % from 2019-20, while oil production rose by 10 % during that period. The industry contributed more than $11.2 billion to the state GDP — 14.2 % of the total.
GO-WV Executive Director Charlie Burd said Thursday West Virginia ranked fifth nationally in two categories: total shale production and total energy production (including other energy sources). And four of top five U.S. natural gas producers operate in West Virginia: EQT, XTO (an Exxon subsidiary) and Southwestern Energy as the top three, and Antero at fifth.
The report notes some industry challenges as the nation still reels from pandemic setbacks, saying, “burdensome lawsuits and imprudent policies have hindered pipeline projects and cut pipeline construction jobs in half.
Asked about that, Burd said, “We’re very disappointed, I think, at the level of anti-fossil fuel programs that are coming out of Washington, D.C.” There are voices of reason, such as Sen. Joe Manchin. “He certainly understands the importance of energy production and how the energy being produced from our state powers the Northeast.”
Burd said, “We’re certainly not discouraged. We will continue to drill and we will continue to produce.”
Horizontal production continues to make up the overwhelming majority of production, Burd said. Of 2.52 tcf (trillion cubic feet) total production last year, 2.39 tcf was from horizontal production — about 95 % — from less than 3, 734 wells. The small remainder was from 58, 410 conventional vertical wells.
So far in 2021 only three conventional well permits have been filed, compared with 188 horizontal permits ; 2019 and 2020 saw no vertical well permits, with only one in 2017.
“That’s just not where the market is ” Burd said. Record low prices — 2020 saw a 30-year low — are part of what’s driving that.
Antero is the state’s top natural gas producer, its total volume measured of 1.073.6 billion cubic feet exceeding the output of the following top nine combined. Southwestern and EQT hold the next two spots and local producer Northeast Natural Energy ranks sixth at 113.8 bcf.
For oil production, Southwestern, Antero and EQT hold the top three spots. Northeast works in the dry gas areas and doesn’t produce oil.
The top 10 gas-producing counties, in order, are Tyler, Marshall, Doddridge, Ritchie, Wetzel, Harrison, Monongalia, Ohio, Brooke and Marion. Tyler produced 597.3 bcf while Mon produced 131.1 bcf.
Natural gas jobs remain among the best paying, Gas Facts reports. Extraction jobs pay more than $95, 000 per year ; drilling jobs pay more than $84, 000 ; pipeline jobs pay more than $106, 000. A total 19, 316 industry jobs paid more than $1.8 billion in 2020.
Property taxes from the industry generated $162.7 million in 2020 while severance taxes came in at $125.7 million for Fiscal Year 2020.
Natural gas demand rises during the winter heating months. Burd said this coming early winter may be milder than usual but is predicted to more normal later on. Looking at an intital lower demand, he said U.S. storage levels not completely full — an advantage we have over Europe with a lower storage capacity. “We have the ability to weather those price swings better than they do.”
The Gas Facts report can be found at gowv.com.
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