Today's Webinar - Dec 18
Posted: Fri Dec 18, 2020 12:18 pm
Matt Marshall at Aegis Hedging Solutions did a great job. We will be sending out a link to the replay later today.
What I learned:
Natural Gas
> Higher Export Demand (LNG and pipelines to Mexico) should offset most, if not all of the lower space heating demand if we have mild weather in Q1.
> Growth of demand from gas fired power plants will continue to grow, but not as much as it has been because of more wind and solar coming on-line.
> Higher oil prices are bearish for natural gas demand because if upstream companies increase drilling budget for oil, it will bring more "associated gas" on-line. This is not a near-term issue because I don't see much chance of a significant increase in drilling programs in 1H 2021 no matter what the oil price does.
> Regional differentials have come WAY DOWN, which is great news for realized gas and NGL prices in West Texas.
> Counterparty risk low, especially when you work with a firm like Aegis to set up hedges.
NGLs;
> Prices are rising, primarily due to lack of raw gas supply.
> Hurricane Laura damaged several large ethane plants, causing a large inventory build. However, that demand should come back in the spring, adding support to NGL prices.
> Other than ethane, other NGL prices are good and likely to get a lot better. < This is bullish for Antero Resources (AR), EQT Corp. (EQT) and Range Resources (RRC)
If you were on the webinar, please post your comment here.
What I learned:
Natural Gas
> Higher Export Demand (LNG and pipelines to Mexico) should offset most, if not all of the lower space heating demand if we have mild weather in Q1.
> Growth of demand from gas fired power plants will continue to grow, but not as much as it has been because of more wind and solar coming on-line.
> Higher oil prices are bearish for natural gas demand because if upstream companies increase drilling budget for oil, it will bring more "associated gas" on-line. This is not a near-term issue because I don't see much chance of a significant increase in drilling programs in 1H 2021 no matter what the oil price does.
> Regional differentials have come WAY DOWN, which is great news for realized gas and NGL prices in West Texas.
> Counterparty risk low, especially when you work with a firm like Aegis to set up hedges.
NGLs;
> Prices are rising, primarily due to lack of raw gas supply.
> Hurricane Laura damaged several large ethane plants, causing a large inventory build. However, that demand should come back in the spring, adding support to NGL prices.
> Other than ethane, other NGL prices are good and likely to get a lot better. < This is bullish for Antero Resources (AR), EQT Corp. (EQT) and Range Resources (RRC)
If you were on the webinar, please post your comment here.