2018 DUG East Conference Highlights

DUG East


Shale gas is remaking and rejuvenating the entire Appalachian Basin region, Tim Dugan, CNX Resources' EVP and COO, told DUG East attendees. Dugan joined other upstream producers, midstream operators and industry experts at the Lawrence Convention Center in Pittsburgh to discuss Marcellus and Utica activity, regional infrastructure and emerging regulatory issues.

CNX, formerly Consol Energy, holds with more than 1 million net acres in the Marcellus and Utica shale plays. Running three rigs through the first half of 2018, CNX is targeting production volumes of 520-550 Bcfe, roughly a 30% annual increase.


DUG East

 Benjamin Hulburt, Eclipse Resources, Tim Dugan, CNX Resources Corp., Jon Farmer, Arsenal Resources


Tonya Williams, general manager at Shell Oil, opened the conference by announcing its world-class cracker -- the U.S. Pennsylvania Chemicals Project -- will be operational in the early 2020s to upgrade locally-produced ethane from Marcellus and Utica shale gas.


Tom Petrie, chairman of Petrie Partners, told attendees the Marcellus, and to a degree the Utica, dominated natural gas supply mainly due to cost. "We are looking at a new natural gas world unfolding," Petrie said. "The U.S. is on the verge of becoming a Top Three LNG exporting country."


The Marcellus and Utica currently provide 27% of total U.S. and Canadian supply, and in a June report, McKinsey Energy Insights projects that will grow to 40% by 2030. Additional infrastructure is needed to keep pace and enable operators to capitalize on a higher wellhead price for export markets, MEI said.


During a panel on economics, Stephen Beck, senior editor of North America Shale with Stratas Advisors, said robust Appalachia production growth is expected to continue. He noted Appalachian producers increased production by 77% since 2015 while reducing F&D costs by 74%.


On the same panel, Randy Wright, president of Wright & Co., said there are 10,000 Marcellus and 2,000 Utica/Point Pleasant wells in Appalachia. One critical success factor is optimizing landing target and staying in the zone; another is increasing lateral length.



Benjamin Hulburt, Eclipse Resources


Eclipse Resources Corp. set several laterals records in the Utica, and President and CEO Ben Hulburt told attendees he expects to break more length records. "We believe we are the industry leader in onshore laterals," said Hulburt. "Frankly, we've become quite good at it."


Eclipse is drilling super-laterals in Ohio and northeast Pennsylvania and its condensate production is also expected to grow ~42% this year. "If you're not going to be a low-cost producer, you're not going to survive in this environment," Hulburt said. "So, we constantly innovate."


exhibit floor

DUG East Exhibit Floor June 20, 2018


Read More Here