Ohio is Becoming a Key Player in the Domestic Natural Gas Industry
Pennsylvania is now the second-largest producer of natural gas in the United States thanks to the unconventional well development technologies that allowed trapped gas to be released from shale layers using hydraulic fracturing, or fracking.
Texas produced almost 24 percent of natural gas 2019, while Pennsylvania was just behind at 20 percent, according to the U.S. Energy Information Administration. What may be surprising to some, however, is that nearby Ohio is also on the list of leaders, at No. 5, producing almost 8 percent of the nation’s gas, while West Virginia is the sixth-leading state. All three states draw their natural gas from the Marcellus and Utica shale plays in this region. The Marcellus contributes the most natural gas to the total, while the Utica is the third-biggest producing play.
A recent report from researchers at Cleveland State University found that “cumulative oil and gas investment in Ohio through December of 2019 is estimated to be around $86.4 billion.” Of that total, $60 billion was in upstream development, $20.2 billion in midstream, and $6.2 billion in downstream industries.
The number of new wells drilled in the third and fourth quarters of 2019 was down by 25 from the first six months of the year. However, 122 new wells were drilled during last six months, and the total volume of gas production was 11 percent higher.
Most of the gas production in Ohio is in the eastern counties that border West Virginia and Western Pennsylvania. Belmont County, which sits along the Ohio River, had the largest number of new wells with 31, while Jefferson and Harrison counties were second and third.
A recent Department of Energy report looked at the economic impact that unconventional well development has had on the country, and Ohio is no different. Ohio would lose 700,000 jobs, $245 billion in gross domestic production and $20.6 billion in tax revenue by 2025, if fracking ended, according to a study from the Global Energy Institute at the U.S. Chamber of Commerce.
The Appalachian region is home to an abundant supply of natural gas and industry groups and government leaders are trying to market that advantage to gas-related industries, such as petrochemical companies and downstream manufacturers. While the increasing focus on reducing greenhouse gas emissions to curb climate change may impact the natural gas industry, it is likely to remain a part of the nation’s energy mix for the forseeable future.