Dec. 12--STATE COLLEGE --The first natural gas extraction wells drilled in Centre County are showing promise, placing the county in a very positive position as commercial interest in the Marcellus Shale natural gas reserve increases.

The shale occurs in the subsurface beneath much of Ohio, West Virginia, Pennsylvania and New York and has the potential to be the largest natural gas field in the United States.

One of the first wells in the area to explore the shale -- owned by Exco Resources near Snow Shoe, was planned for 3,500 feet.

"And here's the punch line for Centre County," Penn State professor Terry Engelder said Wednesday at a natural gas summit. "Exco said it was going to drill to 3,500 feet ... in fact they only went to 1,700 feet and hit a fault."

That fault allowed for the extraction of gas -- 1,800 feet higher than expected and at a rate of 1 million cubic feet a day, according to the company's third quarter results statement.

Exco has had "really, really good results," from the well, results on par with those in other areas of the state that are producing high quality wells.

That means Centre County is "very, very well positioned," for future exploration, Engelder said.

Even as the economy slows down, the exploration of the Marcellus Shale region is expected to increase, said Range Resources CEO John Pinkerton.

Range Resources, Exco and Rex Energy are three companies that are exploring the Marcellus Shale in the region.

Pinkerton said the recession is having an effect on the exploration -- speculation and investment are slowing down, the price of gas is decreasing -- but he said he still expects 2009 to be a busy year for the industry.

Demand for alternative energy is focusing attention on natural gas and the Marcellus Shale.

But instead of pushing for new leases, Pinkerton said he expects the number of lease offers to decline in 2009 as extraction companies shift their focus to developing drilling operations to provide a return on their investments.

Still, in the long run, the resource could create up to 100,000 jobs and annual revenue for the state in excess of $8 billion, he said.

"It will have a huge impact in terms of economics," he said, as new projects bring direct and indirect jobs into the Pennsylvania economy.

Pinkerton admitted he did not know how much gas might be underneath the Appalachia region of the United States, but Engelder did hazard a guess.

Engelder said new studies indicate that the Marcellus Shale region may have enough natural gas to provide 363 trillion cubic feet of gas to the United States -- seven times his estimate of earlier this year. "There's a lot of gas out there," he said.

That number, he admitted, doesn't mean much to most people. Instead, he used the example of a CATA bus, running on the natural gas found in the shale region.

"How far would a CATA bus go? ... About 88 percent of the way to Alpha Centauri," he said. "That's your headline."

Nick Malawskey can be reached at 235-3928.

-----

To see more of the Centre Daily Times, or to subscribe to the newspaper, go to http://www.centredaily.com.

Copyright (c) 2008, The Centre Daily Times, State College, Pa.

Distributed by McClatchy-Tribune Information Services.

For reprints, email tmsreprints@permissionsgroup.com, call 800-374-7985 or 847-635-6550, send a fax to 847-635-6968, or write to The Permissions Group Inc., 1247 Milwaukee Ave., Suite 303, Glenview, IL 60025, USA.

Toronto:XTC, NYSE:RRC, NASDAQ-NMS:REXX,

A service of YellowBrix, Inc.