Jan. US natural gas production lowest in nearly 3 years

US Natural gas production

“The only Texas bright spot has been West Texas Permian production.” – Jack Weixel

Lower-48 US natural gas production averaged 70.2 billion cubic feet per day (Bcf/d) during Jan. 2017, marking the lowest monthly production level recorded since June 2014, according to analysis from IHS Markit.

Jan. production represented the second consecutive monthly decline for US natural gas production, and a 1 per cent (0.8 Bcf/d) decrease below Dec. 2016 average production levels.

Click here for video: CEO Mike Swihart explains how well automation reduces costs, boosts production for Permian Basin operators. Systems start at $3,000 fully installed by Production Lift Technologies of Midland, Texas.

Compared to Jan. 2016, lower-48 gas production is off 3.4 per cent (2.5 Bcf/d).

However, not all areas saw declines in production last month. Gas production is growing in the prolific Northeast region, with production up 0.2 Bcf/d in Jan. versus Dec. 2016 levels, which were 22.5 Bcf/d.

In fact, Northeast production has grown on average the past four months and now stands at an all-time high, besting February 2016 levels of 22.4 Bcf/d, IHS Markit said.

“Production in regions outside the Northeast, most notably Texas, has not been able to keep up the pace. Legacy production decline has been much steeper in Texas than anticipated and new drilling and a higher rig count during the latter half of last year has not yet caught up,” said Jack Weixel, vice president for analytics at PointLogic Energy.

Texas production only averaged 16.5 Bcf/d of total lower-48 natural gas production in Jan., its lowest output since Dec. 2009. Just one year ago, in Jan. 2016, Texas production was above 18.0 Bcf/d, but waning production in East Texas and in the Eagle Ford in South Texas has had a severe impact on total gas supply for the US.

“The only Texas bright spot has been West Texas Permian production, which tends to benefit due to the increased drilling of oil (and associated gas) in the region,” said Weixel.

PointLogic Energy derives real-time natural gas production data from publicly available interstate pipeline flow data in the lower-48 United States. The energy division at IHS Markit provides market insight and analytics for North American power, gas, coal and renewables.