Natural gas production in the US Lower 48 averaged 73.3 billion cubic feet per day (bcf/d) in February, which is up nearly 1.4 bcf/d, compared to the January average, according to Platts Bentek, an analytics and forecasting unit of Platts. This is the highest production on record since Platts Bentek began tracking the data in 2005. On a month-over-month basis, February natural gas production was up nearly 2% from January.
"The natural gas production record achieved in February is largely attributed to the Northeast, which also is still helping offset the declines seen in other major US basins," said Sami Yahya, Platts Bentek energy analyst. "A combination of adequate demand and lack of freeze-offs helped producers push their production volumes to new highs. Typically, the month of February is impacted considerably every year with a bout of freeze-offs, but, this year, the cold temperatures did not linger long enough to cause meaningful impact."
Northeast gas production reached nearly 23.1 bcf/d in February, rendering an average of 22.7 bcf/d for the month. This average was about 0.8 bcf/d greater than the January average and about 1.5 bcf/d more than the December 2015 average. For basins outside the Northeast, the February average was nearly flat or slightly declining from the previous month.
"While the number of active rigs in the Northeast is currently at its lowest historically, the availability of inventory wells is helping producers keep their production numbers leveled," Yahya noted. "We track the number of drilled-but-uncompleted wells in the Northeast monthly. Based on the latest numbers, the number of inventory wells has been declining steadily since November 2015, which is a signal the producers are dipping into their inventory more than ever."
Prior to November 2015, the Northeast had about 2,700 wells in backlog inventory, whereas, in January of this year, the number is barely more than 2,000 wells.
"The Utica is the only place in the Northeast where the inventory numbers are not taking a steep dive," said Yahya. "The big focus now within the Utica is the drier areas, where the initial production rates of new wells are incredibly high. This means you do not need to bring online as many wells to help keep production afloat."
Platts Bentek data analysis suggests that 2016 US natural gas production will average 71.6 bcf/d, with some growth geared toward the end of the year. This will mark a year-on-year decline of less than 1%.
The Bentek data analysis is based on near-real-time production receipt data from the US Lower 48 interstate pipeline system. Platts Bentek production models are correlated with, and provide an advance glimpse of, federal government statistics from the US Energy Information Administration, which will publish its domestic production estimates for September on or around March 31.