The correction in U.S. natural gas production has finally arrived. Volumes are down close to 5% since peaking in late 2015, driven by declines in associated gas and higher-cost legacy areas as well as ongoing curtailments and pipeline constraints across the Northeast United States. Natural gas prices have rallied as a result, with 2017 Henry Hub futures increasing almost 15%, to an average of $3 per thousand cubic feet.
With record power burn set to moderate, however, and as new pipelines are put into service across the Northeast, tight supply conditions should ease. By 2018, we expect prices to once again be governed by the considerable productive capacity of low-cost shale plays like the Marcellus, Utica, and Haynesville. Long-term demand tailwinds still appear favorable, although we continue to believe that at our midcycle prices of $3/mcf Henry Hub and $55/barrel West Texas Intermediate, there is more than enough economically profitable resource to meet growing consumption needs. The temporary spike in natural gas prices appears to be just that: temporary. Our long-term price assumption of $3/mcf is unchanged.
Source: U.S. Shale Boom Finally Runs Out of Gas
Posted in Bakken, Eagle Ford, Haynesville, Marcellus, Niobrara, Uncategorized, Utica
Tagged Bakken, Eagle Ford, Haynesville, Marcellus, Niobara, Permian, Utica
Posted in Bakken, Eagle Ford, Haynesville, Marcellus, Niobrara, Permian, Shale Natural Gas, Shale oil, Utica
Tagged Bakken, Eagle Ford, Haynesville, Marcellus, Niobara, Permian, Shale Natural Gas, Shale oil, Utica
Posted in Bakken, Eagle Ford, Haynesville, Marcellus, Permian, Utica
Tagged Bakken, Eagle Ford, Haynesville, Marcellus, Permian, Utica
New sources of natural gas demand including petrochemical plants, electric generation and pipeline exports to Mexico will rekindle gas activity in shale plays such as South Texas’ Eagle Ford, Houston-based consulting firm ICF International says.
Natural gas prices, which dropped in recent years, likely will rise between 2015 and 2020 along with demand from those sources, according to the ICForecast Energy Outlook for the second quarter of 2014. ICF also expects natural-gas price volatility to increase through the end of the decade.
via Rising natural gas demand is likely to spur more activity in shale plays, ICF says – San Antonio Business Journal.
Posted in Barnett, Eagle Ford, Fayetteville, Haynesville, Mexico energy, Mexico shale, Petrochemical
Tagged Barnett, Eagle Ford, Fayetteville, Haynesville, Mexico energy, Mexico shale, Petrochemical