Thursday, January 31, 2013
While there will be a bit of a slowdown due to weak market prices, drilling efficiencies and associated production as a result of oil and natural gas liquids (NGL) development will sustain North American natural gas production growth into the foreseeable future, says Rick Margolin, west region manager with BENTEK Energy, LLC.
"By and large, at BENTEK, we are suspecting these factors are going to combine to keep gas production within the next four- to five-year window at a very substantial pace," Margolin told the audience at CI Energy Group's ninth annual Shale Oil & Gas Symposium on Wednesday.
For the U.S. and Canada, Margolin expects production to increase from a current level of about 69 billion cubic feet (bcf) per day to about 79 bcf per day in 2017.
In order for producers to specifically seek out and drill for natural gas, Margolin said, producers require a rate of return of about 10-15 per cent. This, he told the audience, necessitates gas prices at about US$4 per mcf, and he expects prices will reach that threshold by 2015.
However, for now Margolin said the number of North American rigs working in shale gas plays is dropping, although total rig counts are actually increasing: "Between January 2010 and today, we've got nearly 500 more rigs operating. But they're not going after gas; they're going after other commodities."
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