The Marcellus is the new king of gas production. At least unofficially so. And its ascension to the throne ushers in an era of creative destruction in the energy business
I posted two weeks ago about the Marcellus' rise to the top at johnhanger.blogspot.com/2012/07/marcellus-production-doubles-from-may.html. The AP now reports that the Marcellus produced the most gas in July.
According to the AP, the Marcellus produced in July 7.4 billion cubic feet per day, or more than 11% of America's gas. Marcellus production rose from 6.9 billion cubic feet per day in May, when the Haynesville shale slightly edged it. Despite a slowdown in drilling, as more gas wells were connected to pipelines, gas production in the Marcellus grew another 0.5 billion cubic feet per day just between May and July.
And make no mistake the Marcellus production is pivotal, a true tipping point. Had it not come on line as quickly as it has, gas prices would not have sunk below $2 in April 2012. The already massive, and still rising, Marcellus production turned upside down energy economics and investment in just five short years.
Gone are the 2008 days of crippling gas prices of $13 for a thousand cubic feet. Gone are the billions of dollars invested to import LNG to meet what was expected to be a domestic shortage of gas. Gone are skyrocketing gas and electricity bills for Pennsylvania's and the nation's consumers.
Gone are the days when US gas prices were linked to oil prices, when carbon emissions were rising, and when coal dominated electricity generation markets.
In the Marcellus era, gas is delinked from oil, gas is displacing coal and oil, and America's emissions of carbon dioxide, soot, sulfur dioxide, mercury, lead, and nitrogen oxides are plummeting. More than anything else, the Marcellus has made gas cheap.
And low-priced gas saved every consumer about $1,500 per year, compared to 2008 gas and electricity bills. Cheaper and cleaner too. Some things do get better.