Natural gas production in the Lower 48 States averaged 72 billion cubic feet per day (Bcf/d) in June, down about 0.6 Bcf/d, or less than 1%, from May’s average, according to analytics/forecasting firm Bentek Energy.
“The month-on-month U.S. production decline observed in June was largely attributed to continued maintenance events in the Northeast,” said Sami Yahya, a Bentek energy analyst. “The combination of reduced drilling and completion costs, as well as considerable efficiency gains in the field, has helped producers across most regions better cope with the distressed commodity prices.”
According to Bentek, the average cost of service companies is down about 20% since last year. Also down are drill times, which have declined, on average, by three to five days this year in a number of plays.
“This translates into the ability of producers to utilize less rigs but drill more wells,” Yahya said. He pointed to the fact some producers say previously, they tended to drill and complete a cluster of wells within an area and move on to the next cluster. Now, they’re more likely to drill all of the clusters first and come back later to complete those wells — saving money by not bringing completion rigs back and forth.
“This can also be viewed as completion deferment,” Yahya said. “It’s also worth noting high-grading — focusing on higher initial production rate areas — remains the primary trend in most areas.”
Bentek projects 2015 U.S. natural gas production will average roughly 72.8 Bcf/d (which has recently been reduced from 73 Bcf/d due to persistent maintenance and outages), with growth occurring throughout the year, driven almost exclusively by continued production gains in the Northeast/Appalachian Basin.
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