Oil and gas investors in the Marcellus stand to gain a piece of the remaining $90 billion in value, according to reports from Wood Mackenzie (Wood Mac).
The Marcellus, considered the largest shale gas play in the world, spans over 30 million acres in four different states; Pennsylvania, New York, West Virginia, and Ohio.
Several sponsors offer access to this play through Regulation D private placements. MDS Energy Development, LLC focuses exclusively on the Marcellus while Vista Resources, Inc. and Bradford Energy Capital, LLC offer access to Marcellus wells through limited partnerships provided through independent broker-dealers.
Wood Mac expects 25,000 wells, over 20 years, to be drilled by the top 20 operators in the Marcellus Region.
Most sponsors of oil and gas private placements do not operate, but rather the partnerships they offer own working interests in multiple wells.
Since 2012, rig counts in the shale play have fallen, but according to the Wood Mac, this is due to improvements in operational efficiency. Drillers have a renewed focus on the play’s core sub-plays and overall well results are improving. Because of longer laterals and high volume completions, estimated ultimate recovery or EURs, have increased by about 10% since last year.
This new finding has led Wood Mac to increase its forecast of 14 bcf/d of natural gas production to 20 bcf/d of output by the year 2020 in the Marcellus Region.