SNL Energy
Analyst: Dry gas plays may be 'pushed out of the game'

Thursday, May 16, 2013

Natural gas production may increase by nearly 15 Bcf/d by 2018, but some dry gas plays could end up being big losers in gas-on-gas competition, BENTEK Energy LLC's director of energy analysis said May 14.

In a conversation with SNL Energy after a presentation at a BENTEK conference in Houston, Jack Weixel said plays with high liquids content will produce more than 50% of incremental production in the U.S. in 2013, a trend that is likely to continue as an additional 14.7 Bcf/d reaches the market by 2018. As gas production from liquids-heavy plays increases, it may change the nation's gas supply-demand dynamic.

"We are definitely seeing pushback on what we call the 'T-pipes' already: Transco [from south Texas to New York City], Tennessee [Gas Pipeline, which carries gas from the Gulf Coast to the Northeast]. … The basins that are feeding those pipes, people are leaving them, and production is less prolific out of them," Weixel said. "The northeast is pushing a lot of inbound gas out, but it's also having the effect of pushing some of the less profitable basins out of the game."

When asked which basins he thought might be in jeopardy, Weixel quickly ticked off several.

For the full report, click here.