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Technically recoverable US gas reserves 20% higher than 2 years prior

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Technically recoverable US gas reserves 20% higher than 2 years prior

The U.S.'s recoverable natural gas resource base is 20% greater than what an evaluation just two years ago showed, the Potential Gas Committee reported Sept. 11.

The nation has about 3,374 Tcf of technically recoverable gas as of year-end 2018, according to the committee. The 557 Tcf jump from two years prior marked the largest increase between the group's biennial evaluations in its history and was driven primarily by new onshore drilling and production results, along with technology gains allowing for better understanding of the basins, the committee said.

"More well drilling and continuous improvements in completion and simulation technologies led to better delineation and characterization of U.S. gas resources, especially in shale and tight reserves," according to Alexei Milkov of the Colorado School of Mines and director of the Potential Gas Agency, which works closely with the Potential Gas Committee. The committee comprises volunteer geoscientists and engineers.

The 3,374 Tcf total represented a mean value computed by statistical aggregation of the minimum, most likely and maximum value distributions.

"This gas resource base has been exceeding all expectations," Richard Meyer, American Gas Association managing director for energy analysis, said Sept. 11, adding that transportation, storage and delivery infrastructure has also been key to bringing the burgeoning supplies to customers. "We're talking about affordability to customers," and boosting economic growth, along with improving reliability, resilience and air quality and reducing greenhouse gas emissions, he said.

Among reservoir types, shale gas dominated, representing 62% of all U.S. gas resources.

The category of "possible resources" rose the most, reflecting continuous development of established plays, Milkov said. "Possible resources" are from shale accumulations farther from known data points of proved reserves and probable resources, such as those in relatively thin deposits or with lower total organic content, according to the report.

Looking forward, Milkov said future increases were also mostly likely to be onshore, as the growth largely arose from improved understanding of onshore plays, whereas there was greater uncertainty surrounding offshore areas where there was less activity.

When the assessment of technically recoverable resources was combined with the U.S. Energy Information Administration's latest estimate of proved reserves, the evaluation put the future U.S. supply of gas at 3,838 Tcf, up 22% from two years earlier, also breaking prior records.

Conventional and tight reservoirs in the assessment saw a 39% increase, or about 340 Tcf, while shale resources increased 12%, or 220 Tcf. Increases were concentrated onshore, where most drilling activity has been focused, with no change in offshore resource assessments, Milkov said.

The Atlantic and Mid-Continent areas had the most substantial increases from traditional resources, up 264 Tcf and 245 Tcf respectively, with new drilling and production results from the Marcellus and Utica plays fueling Atlantic gains. Among the top four regions, the Atlantic dominated in total gas resources, with 1,328 Tcf mean technically recoverable resources, comprising about 39% of the total U.S. gas resources. Behind the Atlantic region were the Mid-Continent's 623 Tcf, or 19% of the nation's total; the Rocky Mountain's 565 Tcf, or 17% of the total; and the Gulf Coast's 519 Tcf, or 15% of the total.

The major increase in the assessment of U.S. gas resources comes amid an uptick in national political debate about whether to keep some of those resources in the ground as part of plans to combat climate change.

Asked about proposed nationwide bans on hydraulic fracturing, such as those favored by some Democratic presidential candidates, Milkov noted that about 70% of the total gas is probably recoverable through fracking.

Maya Weber is a reporter with S&P Global Platts. S&P Global Market Intelligence and S&P Global Platts are owned by S&P Global Inc.