Services

Marcellus Shale Gas — Implications and Opportunities for Companies

Opportunities for companies in the oil and gas industry include:

  • Geological services and technologies (2-D & 3-D geological mapping and mapping equipment)
  • Drilling rig manufacturers
  • Drilling equipment manufacturers (drill bits, piping, cementing, etc.)
  • Logging equipment and service companies
  • Hydraulic fracturing equipment, supplies, and service companies
  • Wastewater treatment equipment and services
  • Wellhead completion equipment (well heads, valves, regulators, etc.)
  • Midstream infrastructure (tanks, pipeline, etc.)
  • Gas processing equipment (fractionators, desalination, etc.)
  • Upstream Infrastructure (large pipelines and storage, etc.)

Some of the developments and their implications for companies are:

  • A new Total Dissolved Solids (TDS) Regulation goes into effect January 1, 2011 in Pennsylvania (PA). This will effectively eliminate all direct disposal of treated frac water into the Pennsylvania water system. The rule severely limits the TDS of disposed water to 500PPM. In effect this means that all frac water will need to be desalinated before it can be released into the eco-system. On-site water treatment is no longer an option for direct disposal recyclingand re-use of the water is the only viable option. Since there is only one desalination facility in PA the costs of processing this waste-water is expected to jump by over 300% . This is an immediate opportunity for companies that have desalination and frac-water treatment technology.
  • Mid and downstream infrastructure projects are abundant; many of the large projects are expected to come online in 2014. There is the full expectation that PA will export gas to both Canada and the Gulf Coast of the U.S. by 2020-2025. Many wells are currently being drilled and capped to be completed at a later date when demand and infrastructure come online. Production will ramp up quickly when infrastructure projects come online, resulting in a huge demand for manufacturers in the gas transport sector.
  • Imports of fuels (oil and gas) to the Northeast US will slow down over the next few years. Development of traditional shale plays in Canada and Western U.S. will slow, unless domestic demand increases or other export markets are developed (e.g., Liquefied Natural Gas plants).
  • The development of a Natural Gas Liquids pipelines from the Marcellus region to chemical industry facilities will have a important impact on the chemical industry.
  • Opportunities will continue to grow for companies willing to come to the Marcellus market. Existing relationships will provide key advantages when pursuing the Marcellus market.