Other formerly Marcellus Shale-only companies may be looking to other parts of the country for diversification, but the pioneering company in the basin remains laser-focused on Appalachia.
Range Resources Corp. (NYSE: RRC) is one of the biggest natural gas producers in Pennsylvania and drilled the first well in the Marcellus in 2004. While it's based in Fort Worth, Texas, Range's natural gas production is in southwestern Pennsylvania and it has a regional headquarters at Southpointe in Canonsburg. It, along with EQT Corp. (NYSE: EQT), and CNX Resources Corp. (NYSE: CNX) are big Appalachian natural gas producers that have seen no need to go beyond the basin. That's in contrast to Southwestern Energy Corp. (NYSE: SWN) and Coterra Energy Inc. (NYSE: CTRA), formerly known as Cabot Oil & Gas Corp., which have by acquisition or merger added shale plays in Texas and Louisiana.
That's not going to be the case for Range, its CEO, Jeff Ventura, told the Business Times in a recent interview.
"We're going to stay focused on Appalachia and we won't be looking at out-of-basin deals like that," Ventura said. Range has previously been a multibasin player but primarily had operations in Pennsylvania; it sold its Hayneville Shale assets in Louisiana for $245 million in August 2020.
Range, which has been in the Marcellus longer than any other player, has in a recent estimate about 3,100 undrilled Marcellus wells and 460,000 net acres in southwestern Pennsylvania, primarily but not exclusively in Washington County, for both natural gas and natural gas liquids, two strong markets.
And that's only Marcellus Shale, putting aside its acreage and potential to drill in the Utica and Upper Devonian, two shale fields that Range hasn't developed as fully as the Marcellus. Range has the largest undrilled inventory of any natural gas producer in Appalachia.
"We've got plenty of inventory," Ventura said. "We're going to stay focused on safely, environmentally friendly, efficiently developing our resources with a lot of optionality to grow when it's called on and there's more infrastrucure and space on pipelines, coupled with, ultimately, I see us developing other horizons as well."
Range, like most publicly traded natural gas companies in Appalachia, has been for the last two years in a steady state of drilling, adding just enough to maintain its production per day and year. Range is also, to increase efficiency and lower costs, going back to pads that it previously constructed (and are producing gas) to additional wells. That's going to continue, even as the market price for natural gas has increased in the past two years.
Ventura is endorsing the call for increased production of natural gas as well as the building of pipelines, liquified natural gas export terminals and oil refineries that will help lower the cost of natural gas and oil both here in the United States as well as across the globe for allies. Ventura said there's a need to build out the energy infrastructure to meet demand and costs, and said the process to build pipelines and other infastructure has become onerous and expensive.
He pointed to the Keystone XL Pipeline as well as, closer to home, the Mountain Valley Pipeline, one project canceled by presidential order after the Biden administration took office and the other mired in court battles and not able to take Marcellus Shale natural gas through West Virginia and Virginia.
Ventura said that natural gas has played a key role in dramatically reducing greenhouse gas emissions for the United States and can do that, pushing out coal burning worldwide, for the rest of the globe. But pipelines and infrastructure have to be built and built in a more timely manner to allow production to grow and the prices of commodities, as well as the many other products like plastics and steel, which are made either from shale or whose manufacturing is aided by natural gas.
"Increasing supply will help reduce costs and I think that's the way to go," Ventura said. "But the key to it, it's back to infrastructure."
Keystone XL shouldn't take nine years to build and neither should the Mountain Valley, he said. Keystone XL, an $8 billion project to take oil from Canada to the Gulf Coast, was officially canceled in 2021 after nearly a decade of development. MVP, which is a project of Canonsburg-based Equitrans Midstream Corp. (NYSE: ETRN), has had several permits revoked and is working to complete the more than $6 billion project, at least four years behind schedule and at twice the cost.
"It should be done in three or four years for their probably original estimate (of costs), not what it is. Companies want to operate safely and be good stewards of the environment," Ventura said. "I think the country needs to fast track pipelines, fast track LNG facilities, fast track refineries in a safe and environmentally friendly way.
"That will significantly increase supplies, because those products are in everything, it would help reduce inflation, and it would be good for the American consumer, create a lot of jobs, good-paying jobs, and all those other benefits. That's really a big part of the answer (to the energy crisis)."