Natural Gas Daily
Rockies output seen steady despite sub-$2 prices

Monday, April 30, 2012

Rockies gas production is expected to remain fairly steady, and even increase slightly, in the next few years as associated gas from liquids-rich plays offsets some price-driven pullback in dry gas basins, analysts said.

Platts unit Bentek Energy is forecasting relatively flat to modestly increasing production out of the Rockies ” from 9.35 Bcf/d in 2012 to 9.34 Bcf/d in 2013 and 9.39 Bcf/d in 2014. "We expect growth in the Denver-Julesburg, Uinta and to a lesser extent the Piceance," said Bentek analyst Rick Margolin.

Accounting for the difference in overall supply projections, Lippman and Bentek include different regions in their definitions of the Rockies. Both companies include Colorado, Montana, North and South Dakota, Utah and Wyoming. Lippman's forecast includes parts of Arizona, Nebraska and Nevada, while Bentek's outlook also encompasses parts of New Mexico and California.

The associated gas volumes from those basins will continue to flow as a result of focused drilling for natural gas liquids and oil, Margolin said. "That growth should help offset declines out of dry gas plays like the Green River and Powder River."

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