APPALACHIAN BASIN ENERGY PRODUCTION - A VIEW FROM THE 21ST CENTURY

During the past 200 years, the Appalachian basin has produced about 44 billion tons of coal, and provided most of the nation’s needs for coal. In 1998, however, on a gross tonnage basis, annual coal production from the Appalachian basin was exceeded for the first time by production from western U.S. coal fields (488.8 vs. 460.4 million tons, [mt]). Since then, annual Appalachian coal production has declined to about 380 mt (2003) and this trend is expected to continue into the future.

In 2002, half of the coal produced annually in Appalachia came from eleven counties. Greene County, Pennsylvania (41.5 mt), Boone County, West Virginia (31.9 mt), and Pike County, Kentucky (30.0 mt) collectively produced about 103 mt annually. Together, they have produced over 3 billion tons of coal since production began. Of these, Pike County is eight years past peak production and is declining. Eight additional counties in Virginia (2), West Virginia (3), and Kentucky (3) produced another 105 mt annually. The remaining 104 coal-producing counties were either endowed with low to moderate amounts of coal or are now many years past peak production. At present decline rates, annual production from the basin could be as low as 250 mt by 2125. This decline (about 35 percent) is expected to precede a general decline in world oil production by a few decades.

About 3.5 billion barrels of oil (BBO) and 44 trillion cubic feet of natural gas (TCFG) have been produced from the Appalachian basin since 1859. In 2002, the U.S. Geological Survey assessed undiscovered resources of nearly 1 BBO and natural gas liquids, and about 70.3 TCFG in the Appalachian basin. In addition, proven reserves are about 0.33 BBO and 10.6 TCFG. Although oil production has declined significantly in the basin over the past several decades, natural gas production has increased, attesting the relative abundance of the resource. Future production will depend greatly on the development of the new technology necessary to produce large, relatively deep, low-grade natural gas resources in continuous accumulations, including tight sandstones, shale gas, and coalbed methane.