"This winter season, we believe that all the combined market forces (slightly warmer than normal weather, stagnant economic growth, moderate growth in overall demand, near record storage levels and a healthy supply) will cause flat price pressure on the gas market compared to last winter," said NGSA Chairman Patrick J. Kuntz, who also is vice-president of gas and oil sales at Marathon Oil Co.
He said US gas production is expected to be nearly 8% higher this winter than a year earlier, based on an independent analysis by ICF International of Fairfax, Va., which NGSA commissioned. "Explorers and developers responded to the market signals, and companies are producing more domestic gas. Current production rates are at their highest level since the early to mid-1970s," Kuntz told reporters at a briefing.
Technology also is playing a significant role, he continued. "Much of our increase in domestic gas production is coming from unconventional plays where technological advances have unlocked the resource. Horizontal drilling is another big advance that allows more gas to be produced from a single well," he said.
NGSA forecasts that 31,530 wells will be completed during the 2008-09 heating season, 753 or 2.4% more than the 30,777 completions during the same period a year earlier. Average production is expected to climb 7.9% year-to-year to 57.5 bcfd from 53.3 bcfd, while the annual average rig count is expected to rise 4.4% to 1,535 from 1,470.
