Natural gas has blossomed into a dominant source of energy, supplying 41 percent of the energy to generate electricity across the U.S. and in many parts of the world.
Just 50 years ago, the federal government restricted the transportation and usage of natural gas through price controls. The policies resulted in shortages on the interstate markets even though there were plenty of supplies in states that produced natural gas.
The advocates for free markets won many political and legal battles through the years, and natural gas has become the fuel of the future.
Natural gas production in the U.S. has increased for 23 consecutive months as electric power distribution and liquefied natural gas (LNG) exports continued to rise.
U.S. dry natural gas production in February averaged 101.5 billion cubic feet per day (Bcf/d), which is 7 Bcf/d (7.4 percent) higher than the same period in 2022, “the highest level for any month since 1973 when we began tracking dry natural gas production,” according to the Energy Information Administration (EIA).
EIA also noted gross withdrawals of 123.1 Bcf/d, which is a 6.8 percent increase over last year of 115.3 Bcf/d, and it is the “highest daily rate of gross withdrawals for any month since 1980, the earliest year in this data set.”
Consumption of natural gas for electric power increased by 7 percent over February 2022.
The U.S. exported 20.6 Bcf/d of natural gas to 25 countries in February, exceeding imports of 8.7 Bcf/d, making the U.S. a net exporter.
Many European countries are importers of natural gas from the U.S. because they have sanctioned natural gas imports from Russia since the attempted invasion of Ukraine.
Many of those imports come from the Gulf Coast of Texas and natural gas produced in the Permian Basin of West Texas and Southwest New Mexico and the Haynesville of East Texas and North Louisiana.
Production in both areas has increased dramatically since the Covid pandemic.
In the Permian Basin, natural gas produced with oil production, which is called associated gas, has been prolific and some wells have had a gas-to-oil ratio as high as 3,000 Mcf to 1 barrel of oil. There is very little spare processing and pipeline capacity to process and transport the 15.9 Bcf/d of natural gas to the Gulf Coast.
The oversupply caused natural gas prices in the Permian to drop into negative territory on several occasions earlier this year.
However, 17 processing plants with a combined capacity of 2 Bcf/d were scheduled to be added this year.
EIA says dry natural gas from the Haynesville shale play in east Texas and western Louisiana reached new highs in March 2023, averaging 14.5 Bcf/d, 10 percent more than the 2022 annual average of 13.1 Bcf/d, according to data from Enverus. Haynesville natural gas production currently accounts for about 14 percent of all U.S. dry natural gas production.
Pipeline takeaway capacity out of Haynesville is currently estimated to be around 16 Bcf/d, according to S&P Global Commodity Insights. Additionally, three new pipeline projects will add 5 Bcf/d of takeaway capacity out of Haynesville by the end of 2024, EIA said.
Alex Mills is the former President of the Texas Alliance of Energy Producers
Alex Mills is the former President of the Texas Alliance of Energy Producers. The Alliance is the largest state oil and gas associations in the nation with more than 3,000 members in 305 cities and 28 states.
- Alex Millshttps://oilwomanmagazine.com/author/alex-mills/
- Alex Millshttps://oilwomanmagazine.com/author/alex-mills/
- Alex Millshttps://oilwomanmagazine.com/author/alex-mills/
- Alex Millshttps://oilwomanmagazine.com/author/alex-mills/
Oil and gas operations are commonly found in remote locations far from company headquarters. Now, it's possible to monitor pump operations, collate and analyze seismic data, and track employees around the world from almost anywhere. Whether employees are in the office or in the field, the internet and related applications enable a greater multidirectional flow of information – and control – than ever before.
