TULSA-Exploiting the Marcellus Shale that underlies much of West Virginia could lead to total cumulative production of 30 trillion cubic feet of natural gas by 2020, a study by ALL Consulting of Tulsa reports. The study was funded by the U.S. Department of Energy's National Energy Technology Laboratory. By 2020, projecting the Economic Impact of Marcellus Shale Gas Development in West Virginia: A Preliminary Analysis Using Publicly Available Data says the annual value added by Marcellus Shale activity in West Virginia will be more than $1.6 billion, based on gross economic output of $2.9 billion. Ten years from now, ALL Consulting predicts, more than 16,000 jobs will be generated and $870 million paid in total state and local taxes. The Marcellus Shale covers 95,000 square miles in six northeastern states. According to a Pennsylvania State University study released in July, as much as 489 Tcf of gas may be recovered from the formation. ALL Consulting predicts as much as 100 Tcf-ISO Tcf could ultimately be recovered in West Virginia. In 2008, operators drilled 299 gas wells in the Marcellus Shale, and the industry contributed $371 million in gross economic output, $189 million in value added, $86 million in direct payments to households, more than 2,200 jobs, and $68 million in taxes, the report notes. ALL Consulting says it sees Marcellus activity in the state growing to more than 900 wells a year by 2020, with commensurate jumps in jobs, taxes and revenues. The study adds that while those benefits are substantial, it is likely they are underestimated. The Marcellus exhibits several pressure regimes in West Virginia, the study notes. Generally it is under pressured to the southwest, and is normal to potentially over pressured to the northeast. It has been suggested that the highest ultimate recoveries will be from the normal to over pressured areas, ALL Consulting says. The presence of these separate pressure regimes necessitates different approaches to well stimulation, it adds. Based on the thickness and thermal maturity characteristics, ALL Consulting observes, the fairway area of greatest potential in West Virginia is in east-central (Nicholas, Pocahontas, Randolph, Tucker, Upshur, and Webster) and north-eastern (Marion, Monongalia, and Preston) counties. Excerpted from The American Oil and Gas Reporter: Jan. 2010 Issue