Friday, October 7 2022 Sign In   |    Register
 

News Quick Search


 

News


Front Page
Power News
Gas News
Today's News
Yesterday's News
Week of Oct 03
Week of Sep 26
Week of Sep 19
Week of Sep 12
Week of Sep 05
By Topic
By News Partner
News Customization
Feedback

 

Pro Plus(+)


Add on products to your professional subscription.
  • Energy Archive News
  •  



    Home > News > Gas News > News Article

    Share by Email E-mail Printer Friendly Print

    U.S. natural gas production to break record by year end


    August 2, 2022 - Staff Oil & Gas Magazine

     

      U.S. gas production will surpass 100 trillion cubic feet by the end of 2022, a record, with further growth expected next year.

      U.S. natural gas production is forecast to reach an all-time high in the coming months, surpassing 100 billion cubic feet per day (Bcfd), helping to fuel global demand as the world faces severe supply shortages.

      Rystad Energy 's analysis shows that production growth from the major U.S. gas-producing Haynesville and Appalachia basins, plus associated Permian gas volumes, will cement the country's position as the world's largest gas producer, extending its lead over Russia, and exceeding the EIA's official growth expectations.

      Within the shale gas plays, Marcellus, Utica and Haynesville will contribute the most. Growth in Appalachia, however, is entirely dependent on the progress of the proposed Mountain Valley pipeline, which still faces significant legal hurdles. Haynesville production alone is expected to grow by a staggering 2.6 Bcfd this year compared to 2021, bringing annual production from the play to more than 14 Bcfd.

      Total basin production is also forecast to increase next year, reaching 17.2 Bcfd by the end of 2023. Elsewhere in the United States, gas production from the Woodford Basin could also contribute significant growth to total production in 2023, with an expansion of 1 Bcfd not off the table.

      Recent increases in the world gas price are driving increased investment by U.S. exploration and production companies looking to capitalize on competitive break-even costs. A well-documented European supply shortage amid efforts to alleviate dependence on Russian gas is further driving up prices on the continent. Although relatively high for the domestic market, price differentials between the U.S. and Europe are so wide that producing and shipping U.S. gas across the Atlantic, even allowing for the costly liquefaction process, remains economically advantageous.

      Gas prices are measured differently in Europe and the United States, but converting European prices to the standard U.S. dollar per million British thermal units (MMBtu) allows a direct comparison. The U.S.-European price differential has widened steadily since the summer of 2020, when unusual market fundamentals brought the Henry Hub, the U.S. benchmark, and the Dutch TTF, the European marker, unusually close.

      The Russian invasion of Ukraine and the subsequent global energy crisis have accelerated the disparity. As of July 15, the Henry Hub was $7 per MMBtu, while the TTF stood at a staggering $47 per MMBtu, nearly seven times the price in the U.S. However, LNG capacity restrictions will limit the amount of gas the U.S. can ship internationally.

      "Already the world's leading gas producer, the U.S. is poised to further increase production to meet global demand, but consumption constraints are a serious risk. However, with new LNG capacity expected to be added after 2024, the U.S. is poised to increase its role in global gas markets for some time to come," says Kristine Vassbotn, senior analyst at Rystad Energy.

      Between 2010 and 2012, Haynesville held the title of the largest U.S. play by production, peaking at approximately 7 Bcfd before declining to less than 4 Bcfd in 2016. Haynesville production declined from 2012 to 2017 as operators shifted their focus to more economic production. positions. But the play recently experienced a renaissance as a core group of producers improved cost efficiency, increasing production in 2021 by 1.6 Bcfd over the previous year.

    TOP

    Other Articles - International


    TOP

       Home  -  Feedback  -  Contact Us  -  Safe Sender  -  About Energy Central   
    Copyright © 1996-2022 by CyberTech, Inc. All rights reserved.
    Energy Central® and Energy Central Professional® are registered trademarks of CyberTech, Incorporated. Data and information is provided for informational purposes only, and is not intended for trading purposes. CyberTech does not warrant that the information or services of Energy Central will meet any specific requirements; nor will it be error free or uninterrupted; nor shall CyberTech be liable for any indirect, incidental or consequential damages (including lost data, information or profits) sustained or incurred in connection with the use of, operation of, or inability to use Energy Central. Other terms of use may apply. Membership information is confidential and subject to our privacy agreement.