The current forecast for the Marcellus/Utica shale calls for continued perplexity. While it is reasonable to assume that operators would be poised to batten down the hatches to ride out stubbornly depressed gas prices, activity in the early going suggests otherwise. Despite average prices hovering around $3/MMbtu—and with later-than-usual winter withdrawals freezing out the typical seasonal bumps—comparatively low well costs, combined with expanding takeaway capacity into the nation’s largest gas market are, for now, contributing to relatively stable drilling activity. The most recent rig count shows the combined Marcellus and Utica shale activity dropping a single rig, at the same time that double-digit nosedives were being recorded across Texas and elsewhere.

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