U.S. Natural Gas Market

[dan_s]

Forbes: Trump Should Tread Lightly When Wading Into Power Markets

When U.S. energy policy is discussed, the focus tends to be on record oil production and on opportunities for Washington to realize economic and geopolitical advantages because of that soaring output. Natural gas receives far less attention. Such neglect is unfair. The opportunities presented by natural gas produced from America's booming shale formations are equally significant, if not more so than those of oil. If the Trump administration understands this opportunity, they have a funny way of showing it. The administration continues to pursue well-intentioned but ultimately harmful policies that risk stunting the growth of America's dominance in natural gas.

The United States is by far the world’s largest natural gas producer with production of around 82 billion cubic feet per day. On a barrel of oil equivalent basis, gas production substantially exceeds our domestic oil production of around 10.8 million barrels per day. To put this in perspective, the entire Middle East produces about 65 billion cubic feet per day, while America pumps over 10% more natural gas than Russia, the world’s number two gas producer. The United States only began exporting liquefied natural gas (LNG) in early 2016, but export levels are already on pace to make the United States the world’s third-largest exporter by the end of 2022, behind only Qatar and Australia.
-------------------
By the end of 2020 the U.S. should have ~19 Bcf per day of export capacity (pipelines and LNG). Today we export 7 to 8 Bcf per day. Cheniere Energy (NYSE: LNG) will soon be ramping up two new export facilities that will increase demand by 1.2 Bcf per day in early 2019. - Dan

[dan_s]

G. Allen Brooks, Managing Director PPHB Energy Investment Bankers: "While natural gas futures prices haven’t cracked the $3/Mcf barrier, they are showing more life than in recent weeks. Recent weak weekly storage injections have left total gas storage volume trailing 2014 - the lowest year in recent times. Gas futures prices have jumped by 20-cents/Mcf, within a hair of that $3 barrier. We need to watch the next few weekly gas injections to better assess the impact of heat-related gas demand and LNG and pipeline exports on limiting the storage rebuild. If true, and it continues, we can look forward to higher gas prices."

Read more: http://www.pphb.com/pdfs/musings/Musings082118.pdf