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[NOTE: this post was co-published on Earth Island Journal's EnvironmentaList]

[UPDATED: 01/23]

The big number to remember in natural gas in the U.S. is that we consumed 24 trillion cubic feet of it in 2010. That’s a lot of hydrocarbons. Today, entire sectors are making decisions about future energy choices based on how much natural gas we have left to burn. And with the Energy Information Administration's new Annual Energy Outlook, it appears we have been making those choices on false assumptions.

The report, released yesterday, issues new estimates of recoverable natural gas in the Marcellus Shale, a vast formation more than a mile below 6* eastern states, including New York, Pennsylvania, West Virginia and Ohio. In 2002, before the shale gas boom got underway, the US Geological Survey (USGS) estimated that there were 2 trillion cubic feet of recoverable natural gas in the Marcellus Shale. Then, as the drilling boom was picking up steam in 2009, Penn State geologist Terry Engelder estimated that the Marcellus holds 489 trillion cubic feet of recoverable natural gas. Then in Jan 2011, the Energy Information Agency released its estimate of 410 trillion cubic feet of recoverable natural gas.

The bubble really started deflating last summer. In August 2011, the USGS said only 84 trillion cubic feet was ‘technically recoverable’. After some effort to reconcile their two wildly differing figures, yesterday, the Energy Information Agency has just issued its new estimate as part of the 2012 Annual Energy Outlook. The new total — 141 trillion cubic feet — is a 66 percent cut from the agency’s last estimate.

So, what gives with all of these varying estimates, and how are shale gas producers, investors, and advocates supposed to know what’s really going on with drilling in the Marcellus Shale?

It appears the producers are learning more with each well that they drill, and drilling, even in the Marcellus region, is a hit or miss proposition. When the 489 trillion cubic feet estimate was published in 2009, it was assumed that all wells in the region would be as productive as the early wells were, and that high rates of productivity would be distributed across the Marcellus. The new estimates reflect that those assumptions were wrong, slashing production estimates by 66 percent.

It’s also important to remember that there is a world of difference between ‘technically recoverable’ and ‘economically recoverable’ shale gas reserves.  With unusually low natural gas prices ($2.43/mcf, or per thousand cubic feet, at the time of writing), the amount of gas that is economically recoverable is a fraction of the amount of gas that is technically recoverable.

Where does that leave us? Hydraulic fracturing of shale gas puts water, air, and public health at risk from toxic contamination. The new estimates in the Marcellus Shale mean that we are taking that risk for only a few years’ worth of technically recoverable natural gas. Accounting for what is economically recoverable, one has to wonder if we can afford that risk to burn a few more years of natural gas?

[CORRECTION: the original post described the Marcellus Shale as underlying 8 states. According to the USGS, it actually underlies 10 states.  But in terms of gas extraction, only 6: VA, WV, MD, OH, PA, NY.  Click here to jump to the corrected text.]