The Marcellus and Utica shale plays will experience extensive growth in coming years as production ramps up, says a leading analyst.

Right now, there are about 25 rigs running in the Utica, with more than 400 outstanding permits. More than 200 wells have been drilled in the region. Manuj Nikhanj, managing director and head of energy research with ITG Investment Research said he expects rig count to increase to about 75 in less than two decades.

“By 2025, assuming this play continues to perform, it could reach over 1 million bbl. of oil equivalent (BOE) per day post-processing,” said Nikhanj. “Our expectation is that it will be heavily weighted toward natural gas and natural gas liquids [NGLs] and less so on oil and condensate, just based on what we’re seeing out of the windows.”d

The most impressive test rates for drilled wells were more than 2,000 BOE per day, he added. The highest figures came mainly from wells drilled in the southern area of the play.

Nikhanj shared play insights and forecasts while speaking at Hart Energy’s Marcellus Midstream-Utica Conference and Exhibition in Pittsburgh. During a presentation to conference attendees, he provided an equally optimistic outlook for the Marcellus.

Right now, there’s about 8.4 billion cubic feet equivalent (Bcfe) of Marcellus wellhead gas production. “Without infrastructure constraints, production would be significantly higher than this,” said Nikhanj. There are currently 90 rigs running in the Marcellus, with northeast Pennsylvania, southwest Pennsylvania and southern West Virginia the most active regions. The potential for the Marcellus is much greater, said Nikhanj.

“Taking into consideration the areal extent of each county, spacing assumptions, wells already drilled to date—and excluding counties in which less than a dozen wells have been drilled—we estimate there are almost 80,000 remaining drilling locations left in the Marcellus.”

Based on the current rig count, there is more than a decade of drilling in any of those counties, once again excluding those with less than a dozen wells, he added.

“We actually think we’re taking the conservative approach on this chart,” said Nikhanj. “It’s an absolutely massive gas field.”

He also shared a few various scenarios that would result in unconstrained growth in the Marcellus. Under a base case assumption of 90 horizontal wells, the play would grow to more than 15 Bcfe per day by 2025, said Nikhanj. Under a 150 horizontal well scenario, the play could grow to more than 20 Bcfe per day by 2025.

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