An already-surging domestic natural gas market will be bolstered further by a bevy of new and expanded pipeline projects slated to begin operation within the next couple of years, argues Margaret Ryan in an article published today in Interfax Energy’s Natural Gas Daily.
Onshore natural gas production in the U.S. currently averages 1.95 billion cubic meters per day, led by drilling in Pennsylvania’s Marcellus formation. That’s seven percent higher than at the same time last year. The EIA predicts that figure will easily reach 2 billion by the end of the year.
“US gas supply is poised to meaningfully outpace demand over the next few years,” said analysts Marshall Adkins and Edward Rowe of Raymond James & Associate.
This high production has bolstered natural gas stockpiles, easing fears of skyrocketing gas utility costs during seasonally cold weather, as occurred in New England last year. In fact, analysts say, there’s enough gas coming out of the ground now to keep prices below the $4 per million British Thermal Units for years to come.
That’s also a lot more natural gas than the country’s existing pipeline infrastructure is designed to handle. Drilling has increased more rapidly than transportation systems, meaning companies have to wait to get their product to various markets and are often stuck placing it in storage facilities.