U.S. natural gas production in August held at July levels at 72.1 Bcf/d: Bentek
Natural gas production in the Lower 48 States averaged 72.1 billion cubic feet per day (Bcf/d) in August, down less than 1% compared to the July average, according to Bentek Energy.
“U.S. rig activity, which surged forward in late July continued to strengthen in August, topping 1,000 active rigs for the first time since April and averaging roughly 1,015 rigs,” said Sami Yahya, a Bentek energy analyst. “Most of the increase in active rig count came from the Permian, where the region added 21 rigs over the July number for a total of 276 rigs.”
Yahya noted there is a close correlation between the number of active rigs and West Texas Intermediate (WTI) spot prices, where directionally the former typically follows the latter after a two- or three-month of lag.
“The jump in Permian active rigs seen in August can likely be attributed to WTI prices topping the $60/Bbl mark back in May and June,” said Yahya, “And as internal rates of return [IRR] climb, producers typically drill more wells to take advantage of the uplift from better prices.”
Bentek data analysis projects 2015 U.S. natural gas production will average roughly 72.4 Bcf/d, with growth occurring throughout the year, driven almost exclusively by continued production gains in the Northeast.
Bentek is an analytics and forecasting unit of Platts.
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