CEOs tell of success in Marcellus shale region - WOWK 13 Charleston, Huntington WV News, Weather, Sports

CEOs tell of success in Marcellus shale region

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At a meeting of independent oil and gas producers, the chief executives of a number of drilling companies reported on their success in drilling for natural gas in Appalachia.

The Independent Oil and Gas Association met in Charleston Wednesday and Thursday. The first speaker was Gov. Earl Ray Tomblin, who said that the amount of gas available to extractors was a "great opportunity" for the state.

"I feel like the state needs to be a partner," Tomblin said. "We regulate the industry, but also it has great potential for us not only in the billions of dollars in investments made here, but will be made in the future. We continue to work toward trying to bring a cracker to West Virginia and I think that will happen."

He said he wants the industry officials to know the state will work with them, including training a workforce skilled to participate in the industry. He said by introducing and passing a horizontal well act early, West Virginia was able to get ahead of surrounding states competing for more oil and gas activity.

J. Russell Porter, CEO of Gastar, said his company has been able to really grow his company in the Marcellus. He said Gastar is an example of what a play like the Marcellus can do for a smaller company.

"We've really built our company, rather through acquisitions, but through the drill bit," he said. "We're really early movers in the basins we participate in."

Gastar first started building up in the region in 2007. Porter said the company has since built a solid asset base.

"Most of our production and our reserves are in the Marcellus, that's really a result of investing a tremendous amount of capital over the last two years," Porter said.

Porter said his company's focus is not beginning to shift from dry gas, which presents challenging economics, to natural gas liquids production.

Larry Richard, CEO of PetroEdge, said he believes their company's expertise is in technical expertise and identifying the potential of Marcellus wells.

"We were one of the first people to ever drill a Marcellus well," Richard said, adding that their first drill went into the Marcellus formation in 2005.

He said then, the company brought a production log to a local geological expert.

"Don't waste your time on it," Richard recalled the geologist telling them at the time. "We had a different opinion on that."

John B. Walker, CEO of Enervest, told conference goers that "Appalachia has treated us very well." His company employs 314 in Appalachia, including 109 in West Virginia.

One of the challenges, Walker said, has been lower gas prices. More gas usage, he said, would be a boon to Marcellus production.

A cold winter is like rain to a farmer for gas companies, Walker said.

"We're just like dryland farmers, we need a winter," Walker said.