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Investing in Natural Gas: The Most Important Source in the World

By Byron King

02/01/10 Pittsburgh, Pennsylvania – Until just three years ago, the Marcellus was an obscure name for an obscure rock formation in the backwaters of geological research. Not anymore…

The tipping point came when Penn State professor Terry Engelder demonstrated that the Marcellus holds as much as 500 trillion cubic feet of natural gas – the equivalent of total US gas consumption for 25 years. There’s over a trillion dollars’ worth of gas down there – probably much more. Even if the estimate is off by 50% or so (and that 500 trillion cubic foot number might be on the LOW side), Marcellus is a very big resource.

Here’s a map showing all of the major shale gas-bearing basins in the US and Canada. The Marcellus is labeled No. 27 – and I don’t mean in terms of size. As you can see, the Marcellus dwarfs all the others.

Shale Gas Basins

“It’s about time we found a lot of natural gas that’s near a major market,” our friend Rick Rule commented on the find. The Marcellus area is right next to some of the most important natural gas markets in the world. Really, can you get much closer to New England, or the Eastern Seaboard, or the industrial Midwest of the US?

With news of the gigantic Marcellus resource, the big players are coming to town. They’re leasing acreage, setting up shop, moving equipment and getting ready for the long haul. Drilling the Marcellus will require much deeper wells. The wells will be expensive, and sophisticated – filled with modern down-hole technology. This is a 50-year operation, and probably more.

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Byron King

Prior to joining Agora Financial, Byron received his Juris Doctor from the University of Pittsburgh School of Law, was a cum laude graduate of Harvard University, served on the staff of the Chief of Naval Operations and as a field historian with the Navy. Our resident energy and oil expert, Byron is the editor of Outstanding Investments and Energy and Scarcity Investor . Special Report – “Why Oil will Hit $200 a Barrel! What to Do to Protect Yourself Financially“

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3 Responses

  1. Betty Pastard said

    Yum, can’t wait to taste it in my city tap water.

    on February 2, 2010.
  2. Ben Schiendelman said

    Uh, and what will burning all this do to global average temperature? Are we serious?

    on February 2, 2010.
  3. Orlon DePitts said

    “Drilling the Marcellus will require much deeper wells” Deeper than what? Certainly not deeper than most Barnett, or Haynesville.
    And if it’s “much deeper” don’t worry about frac fluids in your city water.
    “average global temperature”? You think greenhouse gases are less for coal or fuel oil?

    on February 6, 2010.

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