Energy company makes county No. 1 priority
STATE COLLEGE — Butler County has gas, and Rex Energy wants it.
Ben Hulburt, president of the State College-based gas and oil company, said Wednesday the county is the company's priority, having spent $20 million here in 2009 and planning to spend $70 million to $75 million this year in the county.
The natural gas held in the Marcellus shale layer 6,000 feet underground is what has Rex leasing land and drilling gas wells in Forward Township.
Hulburt said of the five wells the company has opened, a horizontal well has been online for about 200 days and produces about 2 million cubic feet of natural gas per day.
"Butler County's geography is what attracted us in 2006," he said, adding the company has wells in Westmoreland, Clearfield and Centre counties as well.
The Marcellus shale runs through the Appalachian Mountains, which includes southern New York, Pennsylvania, West Virginia and eastern Ohio, and holds natural gas deep underground. One estimate said the region could yield enough natural gas to meet the entire country's needs for at least 14 years.
Geologists long have known about the existence of the Marcellus shale, but the increase in gas prices only recently made it profitable to drill so deep to go after the gas deposits.
Hulburt and two other partners founded Rex Energy in 2000, going public in 2007, with company stock traded on the Nasdaq stock exchange. Rex Energy specializes in gas and oil production across the nation and with wells also in Indiana and Illinois.
In Butler County, Rex Energy has built a refrigeration gas processing plant on Prospect Road in Forward Township, and it now plans a $25 million cryogenic gas processing plant there.
The natural gas coming from Rex's Butler County wells is "liquids rich, meaning beside natural gas, there is also propane, butane and ethane in the gas stream," Hulburt said.
The refrigeration processing plant drops gas temperatures to -30 degrees Fahrenheit, allowing the wet gases to be stripped out, stored and sold as an additional product. Processed natural gas is sent into an interstate gas pipeline owned by Dominion Transmission.
"In 2010, we will build the cryogenic plant that will drop gas temperatures to -107 degrees Fahrenheit, allowing for more of those gases to be removed," Hulburt said.
The new plant also will have a larger daily processing capacity of 40,000 cubic feet mcf, while the current plant processes 5,000 cubic feet.
"Right now we have three to five employees who work the wells and plants, but that will go up with the new plant. We also have 20 land men on the ground there in Butler County, working to establish leases with landowners," Hulburt said.
The company is opening an office in the C.W. Howard Professional Building, 405 W. Jefferson St., Butler.
"We have a very big focus on Butler County, which we believe to be one of the better areas (for gas production)," Hulburt said. "Butler County is our No. 1 priority."
