While New York awaits documents from three large energy companies in order to review the accuracy of their reserve estimates, the USGS released a new report today that significantly increases its previous estimate of how much natural gas is contained in the Marcellus Shale.  However, the estimate is still far below the 500 trillion cubic feet estimated by Penn State in 2008.

In 2002 the United States Geologic Survey estimated the Marcellus Shale to contain 1.2 trillion cubic feet of natural gas and 10 million barrels of natural gas liquids– not much when spread out over such a large area.  The USGS now estimates that number to be closer to 84 trillion cubic feet of technically recoverable natural gas and 3.4 billion barrels of technically recoverable natural gas liquids.

Many an eyebrow was raised in June, when Ian Urbina’s article in the New York Times called into question the economics behind the profitability of shale gas plays.  He went so far as to quote an analyst who called them “Ponzi schemes.”  The article was one of his  series on Marcellus Shale gas, covered in previous posts, but this time Urbina’s journalism sparked a fair amount of backlash.

The United States government, however, is taking Urbina seriously.  So seriously, in fact,  that the Securities and Exchange Commission has subpoenaed some shale gas producers.  The SEC’s investigation will compare actual well production versus predictions, to determine if gas reserves are being estimated correctly– or if they are being grossly and illegally overstated.