Prometheus Institute

In the past, the number of gas-oriented drilling rigs in a particular region has been a common metric for estimating the production of natural gas. However, technological advances have led the way to the widespread use of new oil and natural gas extraction techniques that have opened up a hydrocarbon resource base dramatically larger than previous estimates. Because of these new methods of extraction, generally in wide use since 2007, natural gas production has steadily risen, while the number of active rigs characterized as targeting natural gas has fallen dramatically.

The number of wells drilled nationwide that have produced both oil and natural gas increased from 37% in 2007 to 56% in 2012 (see chart below). This increase helps explain why natural gas production can rise (as it has) even as the number of rigs characterized as drilling for natural gas has fallen.

via Rethinking rig count as a predictor…

View original post 15 more words