While the 1,386 Marcellus wells drilled last year fell short of early projections of 1,750, operators are drilling bigger wells with longer laterals, some reaching underground for more than a mile.
The bigger wells require larger amounts of water, steel - and money. Operators say they are spending $4 million to $6 million per well.
The drilling is producing greater environmental anxiety, measured by a growing opposition to hydraulic fracturing, the method used to extract gas from shale.
But investors are still bullish, emboldened by production figures released by the Pennsylvania Department of Environmental Protection.
"The Marcellus is going to be far more prolific than we ever imagined," said Subash Chandra, managing director of Jefferies & Co. Inc., an investment company. "It's almost scary how good the Marcellus is. It's supereconomic."
Last month, 102 drill rigs were operating in Pennsylvania, up from 27 two years ago, according to Baker Hughes Inc., of Houston.
Though the Marcellus formation lies under half the state, drilling so far is concentrated in a few counties.
Five companies, led by Chesapeake Energy Corp., produced 69 percent of the Marcellus Shale natural gas over the 18 months ended Dec. 31, according the Powell Shale Digest, a trade publication.
And 80 percent of the Marcellus gas was produced in just five counties - Bradford, Susquehanna, and Tioga Counties along Pennsylvania's northern border and Washington and Greene Counties in the state's southwest corner.
Drilling has outpaced the industry's ability to sell the gas.
Only 1,237 of more than 2,300 Marcellus wells drilled were producing gas at the end of 2010.
Hundreds of wells are finished but awaiting construction of pipelines to carry the fuel to consumers.
And others are incomplete because of a shortage of crews to hydraulically fracture the wells.
Kathryn Z. Klaber, president of the Marcellus Shale Coalition, an industry trade group, said service companies "can't keep up with the work." Some are booked solid for two years.
Here is a ranking of the Top 20 Marcellus drilling companies, based on gas produced from July 2009, when Pennsylvania began requiring public reporting of production, to December 2010.
The company's outlooks are based on their public statements to investors and in filings with the Securities and Exchange Commission. Sixteen of the companies have publicly traded stock.
Chesapeake Energy Corp., Oklahoma City. Chesapeake, which has 1.7 million Marcellus acres concentrated in Bradford and Susquehanna Counties, produced the most gas of any operator.
With natural gas prices in the doldrums, Chesapeake is shifting resources to other states that produce more profitable oil and liquid hydrocarbons. Its Marcellus drilling will stay steady this year, funded by a $3.4 billion investment from StatoilHydro ASA of Norway.
Talisman Energy Inc., Calgary, Alberta. Talisman is also shifting resources to more lucrative oil plays elsewhere. The company is reducing the number of drill rigs from 12 to nine, and growth will slow.
Still, the company plans to spend $800 million in the Marcellus this year, producing as much as 400 million cubic feet a day, up from 315 million a day at the end of 2010.
Range Resources Corp., Fort Worth, Texas. Range, which pioneered Marcellus drilling, is shifting its capital into Pennsylvania. It plans to spend 86 percent of its $1.4 billion capital budget on the Marcellus this year.
Range produced 200 million cubic feet of gas at the end of 2010. It aims to double production by the end of 2011.
Cabot Oil & Gas Corp., Houston. Cabot exceeded its production targets last year by 27 percent, despite environmental conflicts with regulators over its Susquehanna County operations.
Cabot says it will invest $350 million in Pennsylvania this year, more than half its national budget. It plans to drill about 50 horizontal wells during 2011.
Chevron Corp./Atlas Energy Inc., San Ramon, Calif. Chevron in February closed its $3.6 billion acquisition of Atlas Energy, founded by Philadelphia's Cohen family.
George Kirkland, a Chevron executive vice president, told investors that it has nine rigs operating in the Marcellus and expects to drill 70 wells this year.
Royal Dutch Shell P.L.C./East Resources Inc., the Hague, Netherlands. Shell paid $4.7 billion last year for East Resources, whose acreage is in northern Pennsylvania.
Shell put drilling in Pennsylvania on hold after the acquisition to change equipment and personnel, said Michael D. Watford, president of Ultra Petroleum Corp., a Shell partner in the Marcellus. Watford told investors that Shell planned to step up production this year.
EQT Corp., Pittsburgh. Marcellus wells represented nearly 19 percent of its volume last year, up from 3 percent in 2009. EQT has drilled 143 horizontal wells, of which 67 are producing. The company is facing capital constraints and needs to get its gas to market to generate cash.
Chief Oil & Gas L.L.C., Dallas. The private company has about 500,000 acres in Pennsylvania, West Virginia, and Maryland. It operates nine rigs, has drilled 130 Marcellus wells, and plans to spend $475 million in 2011 to drill 100 more.
Consol Energy Inc., Canonsburg, Pa. The coal producer last year acquired 500,000 acres from Dominion Resources Inc. and is ramping up its Marcellus program. It drilled 24 wells last year and produced 40 million cubic feet of gas a day. It plans to triple those numbers this year.
Seneca Resources Corp., Houston. Seneca, a subsidiary of National Fuel Gas Co., of Williamsville, N.Y., has 745,000 Marcellus acres and is now producing more than 120 million cubic feet of gas a day from 59 wells it operates or owns a share in. It is seeking joint-venture partners to expand production.
Energy Corp. of America, Denver. The private company, which has been operating in Appalachia for 45 years, last year raised $176 million selling Marcellus Trust units, which will pay income on the royalties from 14 producing Marcellus wells and 52 additional wells to be drilled over four years in Greene County, where ECA is focused.
EOG Resources Inc., Houston. The former Enron gas subsidiary holds 210,000 acres in the Pennsylvania Marcellus, mostly in Bradford, Clearfield, and Elk Counties. It produces 20 million cubic feet of gas a day and plans to drill 30 wells in 2011.
Ultra Petroleum Corp., Houston. Ultra controls 260,000 acres and plans to spend $380 million of its $1.1 billion budget this year to drill 80 wells in Appalachia. It is involved in joint ventures with Shell and Anadarko Petroleum Corp. It expects Marcellus production to account for half its revenue by the end of 2012, up from zero in 2009.
Williams Cos. Inc., Tulsa, Okla. The company, which operates pipelines in addition to an exploration unit, plans to increase its Marcellus drilling rigs from three to six this year.
Phillips Resources Inc., Warrendale, Pa. A private Western Pennsylvania gas-driller, Phillips has about 250,000 acres under lease and operates more than 4,000 producing wells, including interests in 50 Marcellus wells.
Anadarko Petroleum Corp., The Woodlands, Texas. The global energy firm has 260,000 acres leased, half of them in Pennsylvania state forests. It operates in joint ventures with Chesapeake in north-central Pennsylvania and is running 10 rigs, funded by a $1.5 billion investment from Mitsui & Co. of Japan.
Exxon Mobil Corp./XTO Energy Inc., Irving, Texas. Exxon bought XTO last year to gain entry into shale-gas production. XTO has 217,000 acres in Pennsylvania, a small part of its U.S. acreage.
Citrus Energy Corp., Castle Rock, Colo. The private firm operates four prolific wells on Wyoming County land owned by a Procter & Gamble Co. paper mill.
Rex Energy Corp., State College, Pa. Rex has 57,000 Marcellus acres, mostly in Butler County. It plans to spend 65 percent of its $149 million capital budget in Butler County.
Southwestern Energy Co., Houston. It invested about $118 million in Pennsylvania last year and participated in 21 wells, of which six were completed in Bradford County. It plans to invest about $265 million in 2011.
Contact staff writer Andrew Maykuth at 215-854-2947