Pennsylvania Oil and Gas Industry Trends: Drilled Wells, Violations, Production, and Waste

Production

As we saw above, drilling for new unconventional wells in Pennsylvania peaked in 2011 with 1,958 new wells, while in 2023, the industry drilled less than one quarter of that amount, with just 421 such wells. However, the total production remains high.

Production Summary: Methodology

The production report contains a number of useful data fields, leading to a variety of ways in which the data can be sliced and diced. Each variant in that regard gives a glimpse into a different segment of the industry. In this section, we are looking at production data in the five-year period from 2019 to 2023. Because the difference between conventional and unconventional wells in Pennsylvania is so stark when it comes to production totals, that distinction is a primary category in our analysis, with the data for each year totaled in each of these groups, as well as overall sums.  

The number of wells is an important consideration when talking about production trends.  Here, we have totaled the count of all wells on the report as well as just the producing wells that reported some amount of gas, oil, or condensate in any given year.  Because the unconventional data is reported monthly, a count of all of the wells on the report would actually overcount each well of that type by 12 times, assuming that such a well appeared on each monthly report throughout the year. To get around this, we used Excel’s Distinct Count function within their pivot tables tool. 

The next three columns of data include totals of the three hydrocarbon production categories in the state, including gas, measured in thousands of cubic feet (Mcf); oil, measured in 42-gallon barrels (Bbl), and condensate, also measured in barrels.  

To do this, analysts combine the energy output of the oil and gas into a barrels of oil equivalent (BOE) figure. There are a couple different standards for doing this. The Internal Revenue Service bases their tax calculations off of 5.8 million British thermal units, or roughly 5.8 Mcf equaling one barrel of oil in terms of energy output.  The United States Geological Survey uses an even 6 Mcf for the conversion. This latter figure is used by the industry for most purposes, and we are using that conversion here.  

Condensate is a collection of liquid hydrocarbons associated with natural gas, generally consisting of ethane, propane, butanes, and pentanes. These heavier hydrocarbons are frequently separated from the gas stream at facilities like cryogenic plants, but because this is the well production report, we are talking about only those hydrocarbons that are separated at the wellsite in this situation.  Condensate is frequently thought of as equivalent to light sweet crude oil, so in terms of BOE, we have it set as equivalent to oil.  Therefore, our overall formula for calculating BOE becomes:

(Mcf of Gas/6) + Bbl of Oil + Bbl of Condensate = BOE

Using this BOE calculation, we have also calculated the average BOE per day for wells in each category.  Also needed for this calculation is the total number of production days.  To accomplish this, we used the maximum number of reported production days for any of the three hydrocarbons within each reporting period. Typically, when a well reports multiple hydrocarbons, the same number of producing days will be used for each type, and if we were to include all categories, we would have monthly reporting periods for some wells with 60 or 90 days in it.  This method prevents such an overcount.  

Production Summary Results

Table 5. Summary of Pennsylvania production reports from 2019 to 2023.

Table 5 is a data-dense summary of production trends in Pennsylvania over the last five years. As with previous analyses, we can see that the vast majority of gas (98.9% in 2023) and condensate (99.3%) comes from unconventional wells.  Conversely, almost all of the oil (95.7%) comes from conventional wells.  

After years of exponential growth, unconventional gas production seems to have leveled off in recent years, with almost 7.6 trillion cubic feet (Tcf) of production in 2021 and around 7.5 Tcf in 2022 and 2023.  

There are a number of other variables worth considering when looking at production data. Many of these variables are included in the production report but could change over time, such as well operator and status. Others should remain consistent, such as spud date and latitude and longitude coordinates. In an attempt to get the most up to date information, we attempted to obtain this data from the most recent official inventory of more than 220,000 wells.  

Unfortunately, there were still 2,350 wells on the production reports for 2023 that weren’t on the official inventory despite the latter having more than twice as many wells on it, as counted by API numbers. The result is that the data was joined with both methods, with 88,247 having the most updated data, and the remaining 2,350 wells pulling data from the production reports.  

Conventional Wells

In 2023, there were 77,482 conventional wells on the production report. Wells of this type are reported annually. Because there have been instances of backfilled data on the production report in the past, it is worth noting that the data for this analysis was downloaded in May 2024.

While there are tens of thousands of wells in this category in Pennsylvania, the vast majority of them are very light producers. For tax purposes, there is a category known as stripper wells, which produce less than 15 barrels of oil or 90 Mcf of gas per day—wells that are either toward the end of their production life or were never very productive in the first place. Since it is common for wells in Pennsylvania to report hydrocarbons in more than one category, we have calculated the combined barrels of oil equivalent per day (BOE/Day) for these wells to see how many qualified for this very-low production category:

Table 6. Investigation of conventional stripper wells in 2023.

Only 74 wells, or 0.1% of the total inventory, reported production in excess of the 15 BOE/Day threshold.  It’s possible that some of the wells that have blanks or zeros are not technically stripper wells, if they are not yet in production or have a regulatory inactive status, for example. But at a minimum, 88.55% of conventional wells have production values that are below that cutoff.

In terms of production, there is an extreme outlier among the conventional wells. The “Hirhm Day 1” well in Washington County reported 8,753,268 Mcf of gas, good for a BOE/Day value of 3,996.9.  The next closest wells are a pair of wells from Clarion County that both reported an even 100,000 Mcf over just 60 days of production, good for BOE/Day values of 277.8. Round numbers are not unheard of on the production report, by the way—five other conventional wells report 100,000 Mcf as well, but had more listed production days.

Figure 4. Daily production for conventional wells in Pennsylvania, arranged by spud date.  Note that wells without a known spud date will default to 1/1/1800. Also note that one extreme outlier is excluded from the scatter plot.

Production values from conventional wells in the state do not appear to be a meaningful function of the well’s age, mostly because almost all of these wells are terrible producers. Those 74 wells with production greater than 15 BOE/Day seem to be fairly well scattered in terms of age. The outlier mentioned above was one of 12,441 with the default 1/1/1800 spud date.

With production statistics like these, it is easy to understand why conventional drilling has all but ceased in Pennsylvania in recent years. Additionally, it’s clear that there will be tens of thousands of wells needing to be plugged in the coming years.

Unconventional Wells

Production in unconventional wells in Pennsylvania is, of course, substantially different from the much smaller conventional operations. With a formation reporting more than 7.5 trillion cubic feet of gas, it seems strange to even entertain the idea of stripper wells in the same context as the clearly dying conventional well industry. But let’s look at it anyway, for the sake of consistency.

Table 7. Investigation of Pennsylvania’s unconventional stripper wells in 2023.

And indeed, around 86% of unconventional wells produce more than this threshold.  Still, it is interesting that at least 5.51% of these newer wells are already producing less than 15 BOE/Day, a number that could swell to 14.03% if blanks and zeroes are included.

Figure 5. Daily production for unconventional wells in Pennsylvania, arranged by spud date.  Note that wells drilled into unconventional formations before the creation of the classification were retroactively assigned to the category.

Generally speaking, the expectation is for wells to produce high quantities of hydrocarbons in the earlier stages, decreasing swiftly over time, a phenomenon known as a decline curve. While the number of records shown necessitated showing the years on the vertical axis, if you mentally rotate the chart above counterclockwise by 90 degrees, you can get a rough idea of what decline curves for this type of well would look like, and the dropoff is fairly steep.  

Let’s take a look at the data another way, by creating a histogram.

Figure 6. Histogram showing the number of wells in production groups with increments of 250 BOE/Day. Data labels have been added to show the number in each group because many appear blank at this scale.

Unconventional wells in the state obviously have some real gushers. The well producing the most gas in 2023 is the perhaps aptly named King Hippo well in Greene County, with 10,071,786.47 Mcf, or just over 10 billion cubic feet from a single well. This is almost as much gas as was sent to residential consumers in Vermont and New Hampshire combined last year, although to be fair, that part of the country often relies on other fossil fuels for heating purposes.

Even so, wells of this sort are clear outliers:  8,014 of the unconventional wells, or 61%, produced less than 250 BOE/Day in 2023, while 10,975 (84%) produced 1,000 BOE/Day or less. The 1,035 wells yielding more than 1,000  BOE/Day account for less than 9% of the state’s unconventional inventory.

Table 8. Total gas production for unconventional wells in 2023, arranged by BOE/Day.

In Table 8, we can see that wells producing less than 250 BOE/Day account for two-thirds of the wells (excluding blank values from Table 7, but including zeroes), but those wells only produce around 21% of the gas.  While certainly more productive than their conventional counterparts, most of these wells are probably close to the end of their life.  As of June 6, 2024, 1,299 unconventional wells have already been plugged in the state, amounting to about 9% of wells of this newer type that have been drilled to date, as indicated by the presence of a spud date in the well inventory.  Clearly, the deciding factors for when to plug unconventional wells are different.  

This trend may tie in directly with the decreasing number of wells drilled in the state that we saw in the drilled wells trend above, as well.  To put this into some context, let’s take a quick look at some national data for a moment, focusing in on gas storage over the same period of time.

Figure 7. Gas storage withdrawals and injections in the United States from 2019 to 2023.

We can see over the last five years that the gas withdrawals (green) and injections (orange) are relatively close to one another. If we were to look at this data monthly instead, we would see a recurring trend of building up stocks over the warm summer months which then get used over the winter months as homes and businesses use the fuel for heat. The red line in Figure 7 shows net withdrawals. These numbers are negative for three of the past five years, meaning that more gas was injected than consumed from storage. Taking all five years into account, this amounts to an increase of 865,199 billion cubic feet of storage.

This makes the trend of drilling fewer wells understandable, because producing additional gas would also require an increase in additional infrastructure, which hardly makes sense to build out.

Case Study: The Midas 6M Well

As we can see from the analysis of trends in the Drilled Wells and this Production section, production values remain high for unconventional wells in Pennsylvania even though the number of new drilled wells has been on the decline for almost 15 years. How can this be?

The short answer is that the wells that they are drilling are much more intensive than in the early days of the Marcellus Shale. Here are some claims from Olympus Energy, operator of the Midas 6M well in Plum Borough, Allegheny County, for some additional context.

“Olympus has announced the successful execution of the Midas 6M, a Marcellus Shale well with a completed lateral length of 20,060 feet, setting a new record for the longest horizontal wellbore drilled and completed in the Marcellus Shale according to public data….

“In 2009, the average lateral length for Marcellus Shale wells drilled in Pennsylvania was approximately 3,500 feet. Technological advancements in unconventional drilling improved operational efficiencies over the next decade, driving that average up to approximately 9,000 feet in 2019. The lateral of the Midas 6M is 11,000 feet longer and spans nearly 3.8 miles.”

So, we are looking at a lateral length that is 5.7 times longer than the average unconventional well from 2009. Let’s take a look at the production for this specific well to see how it turned out.

Figure 8. Gas production of Olympus Energy’s Midas 6M well in Plum Borough, Allegheny County.  Figures are thousands of cubic feet (Mcf).

Midas 6M hasn’t produced any oil or condensate, so we just looked at gas production here. It was completed in October 2020, so we are included that month through the most recently available, April 2024: 43 months in total. This well follows the overall trend of peak production in the first few months of the well’s life cycle, which then proceeds to decline over time. In this case, the top producing months were December 2020, with 1,018 million cubic feet (MMcf), and January 2021, with about 1,038 MMcf. By April 2024, that figure had dropped to around 214 MMcf, a little less than 21% of the peak production. There appears to be an anomaly in the decline curve between March and June of 2023.  While we didn’t look at this in terms of BOE/Day, there is a clue in the production data where that would be relevant. In April of that year, where the visible dip occurs, the well was only in production for 15 days, so only half of the days. Whatever gas was held back seemed to come out the following month, which saw the highest production total since April of the previous year. 

It can’t be denied that this well has been highly productive, giving up around 18.6 billion cubic feet of gas so far. And, if we want to relate it to the above analysis of BOE/Day, it is still in the highest category, with 1,187 BOE/Day for April 2024, as one might expect from a well with a record-setting lateral that has been in service for less than four years. But let’s take a look at what was required to make this happen.

Unconventional wells in Pennsylvania, as with many states, are required to disclose some data about hydraulic fracturing operations to an industry-funded registry known as FracFocus. Another site, Open-FF, is dedicated to making the information more easily accessible and understandable to the public. For example, there are menus where you can search for wells by geography or operator.  What’s more, in FracFocus reports, operators proclaim the amount of each chemical in terms of a percentage of the overall mass of the fracking fluid, and Open-FF converts that into pounds, which most people would find more useful than percentages.

Each well in the inventory has a summary page on Open-FF, including the Midas 6A well. At the top, we can see that the well used about 39.7 million gallons in the fracking operations, which does not include other uses on site, such as dust control. In context of the frack job, this amounts to 1,978 gallons per linear foot of the lateral. This is equal to 264.4 cubic feet per foot of pipe—imagine a solid cylinder of water 18.35 feet in diameter and 3.8 miles long. That’s how much water that is.

The well also used 52,775,657 pounds of quartz sand in the frack job. This works out to 26,388 tons.  That works out to 2,630 pounds, or about 1.3 tons, per linear foot. If you went to Home Depot and purchased a pallet of play sand, you would be about 70 pounds short of the amount of sand used for one foot of lateral pipe, so toss another bag and a half on top. As with the water, we would need to line this amount for each foot in the 3.8 mile length.  

We also know that this well consumed 796,311 pounds of hydrochloric acid, or just about 40 pounds per linear foot. Industrial-grade hydrochloric acid is just about ten pounds per gallon, so you’ll need to pick up four gallons per foot on this epic Home Depot run.

Also added was 53,881 pounds of other chemicals, and while this is much more modest in terms of quantity, these are items of concern in other ways. Some of these cause health effects such as serious eye damage and nausea, headaches, and shortness of breath, while others are described as, “very toxic to aquatic life.” 

Waste

In the production section of this article, we went into considerable detail about the difference between conventional and unconventional wells. A similar dynamic exists for the waste stream, but is so extreme that it can be summed up in a basic chart. We are also going to focus mostly on just 2023 waste data so that we can get into some details available in the report without making endlessly complex tables and charts.

Table 9. Waste produced by conventional and unconventional wells in Pennsylvania in 2023.  Unconventional wells accounted for 98.8% of the total liquid waste and 98.1% of the total solid waste.

When we convert the units in Table 9 into terms that we are more familiar with, we see that conventional wells cumulatively produced a lot of waste, with more than 39.4 million gallons of liquids and 35.4 million pounds of solid waste. And yet, these amount to a figurative drop in the bucket when compared to the overall totals of almost 3.4 billion gallons of liquid waste and 1.6 billion pounds of solid waste. Overall, the smaller number of unconventional wells are generating about 51 times as much solid waste and 85 times as much solid waste as their conventional counterparts.

While the purpose of this discussion is focused on waste volumes and movements, it is important to take a moment to consider the impact of these substances. In November 2023, the League of Women Voters and the University of Pittsburgh Graduate School of public health hosted the 11th annual Shale and Public Health Conference, for which discussions around waste are always a major topic. This includes not only the vast array of chemicals that are pumped into wells that may impact workers and nearby residents, but also many of the contaminants that are present in the deep formations that are being drilled into, including problematic heavy metals such as arsenic and radioactive substances such as radium. Some of these contaminants become concentrated due to how humans interact with the waste stream; for radium and other radioactive waste, this becomes known as technologically enhanced radioactive materials, or TENORM.

Waste Generation

The way the production reports are set up is a bit more complicated than liquid versus solid waste.  There are 20 different waste categories in all, but each of them are reported in either 42-gallon barrels, which we frequently lump together as liquid waste as a matter of shorthand, or in tons, which we consider as solid waste for the same reasons.  

Table 10. Waste produced by conventional and unconventional wells in Pennsylvania in 2023. Waste by type generated from Pennsylvania wells in 2023.  This data is self-reported by operators to Pennsylvania DEP.

As we browse the various waste categories, it becomes apparent that some of the waste falls a bit in between the classical liquid and solid categories. For example, the last two categories are both wastewater treatment sludge, of which there were 27,209 barrels and 12,756 tons reported during 2023. There are a number of other categories where waste gets split in this fashion, including drilling fluid waste, other oil and gas wastes, produced fluid, servicing fluid, soil contaminated by oil and gas related spills, and unused fracturing fluid waste.  

It’s not entirely clear why some of these categories are determined in one direction or the other, but it would seem reasonable to imagine that such waste products are often sludgy in nature, and some determination, whether the percentage of liquid or a certain suspended solids threshold requires the declaration in one form or another.  

It’s probably not worthwhile to get overly bogged down on this particular issue for a couple of reasons.  First, some sort of shorthand is helpful when there are 20 different categories of waste to consider, even if some of it is a bit ambiguous. And second, both the liquid and solid waste categories have primary drivers which account for the majority of the waste. For liquid waste, the 76,612,541 barrels of produced fluids in 2023 accounted for 95% of waste reported in barrels , while for solid waste, the 794,803 tons of reported drill cuttings accounted for more than 85% of the total waste reported in tons. Therefore, we see that these categories are fairly accurate, even if there is some degree of ambiguity.

Waste Disposal

The waste reports also allow us some understanding of how the waste was disposed of, including the method of disposal and the destination. Let’s take a look at those same waste totals from 2023, but this time from the lens of how it was disposed of.

Table 11. Waste totals from Pennsylvania oil and gas wells in 2023 by disposal method.

Of the 16 disposal methods listed above, there are a few things worth pointing out. The largest single category for disposal of liquid waste is reuse at a well pad with about 36.2 million barrels, accounting for 44.8% of the volume. If we include conventional and out of state well sites, that figure goes up to about 39.4 million barrels, or 48.9% of the liquid waste.  

One of the unique features of the Pennsylvania waste reports is that they also inform us where the waste was sent after leaving the well pad. To accomplish this, there are two sets of latitude and longitude coordinates, one for disposal or treatment facilities, and one for well pads, when a portion of the waste is reused in another fracking operation.