Natural gas production onshore of the U.S.’s Lower 48 states will hit bottom in November at 82.5 billion cubic feet per day (Bcf/d), according to Rystad Energy.
The Norwegian intelligence firm said earlier this week the drop is caused by the Covid-19 pandemic, Kallanish Energy reports.
Most of the expected fall is to come from natural decline, which won’t be offset as the coronavirus crisis has affected spending and drilling activity.
The shut-in of some producing fields is also halting associated gas production, but not “as quickly as the market hoped for so far,” Rystad’s head of shale research Artem Abramov.
In November 2019, the U.S. Lower 48 gas production, which excludes the Gulf of Mexico, was at around 94 Bcf/d. Volumes dropped to 88.9 Bcf/d in April this year and roughly 86 Bcf/d in May.
After the forecasted November low, Rystad anticipate a “slow recovery” with production growing by around 1 Bcf/d by mid-2021 and another 1 Bcf/d by the end of next year.
The outlook assumes WTI at $35/Bbl and Henry Hub at $2.5/Mcf in the first half of 2021
This post appeared first on Kallanish Energy News.