Many industry experts believe that 2009 is a very good year
to acquire domestic natural gas production. Pricing is lower
than it has been in a number of years, yet demand and supply
are only off slightly from the levels they have been at in the
past 5 years. Low pricing is greatly affected by the uncertainty
in the US economy and a slight excess in natural gas inventories.
Looking at key statistical data shows that this imbalance will
soon be overcome and pricing will move back to appropriate levels
in the near future, especially when the US economy begins to
recover. In the short term, it looks like natural gas will be
priced relatively low, making it potentially one of the best
times in history to buy producing natural gas assets.
Some Key Facts on Natural Gas:
- In the last 10 years, over 90% of the new
electric capacity built in the US has been from Natural Gas
fired generation.
- Natural Gas now accounts for approximately
20% of the energy used to create electricity in the US.
- Approximately 84% of Natural gas used in the
US is produced domestically.
- Only 2% of Natural Gas used in the US comes
from overseas.
- Natural Gas heats more homes in the US than
all other energy sources combined.
- The Obama administration
pledged to have the US in a position that we will require
no oil imports for our energy needs in 10 years. That
will make domestic, clean burning, Natural Gas a highly important
source to reach that goal.
One of the best ways to get a read on supply of Natural Gas
is to look at the rig counts in the U.S. Rig counts tell us
where operators are in drilling for new production which is
important to offset the natural decline in producing wells.
- 80% of rigs in the US today drill for Natural
Gas.
- It takes 4 times the number of rigs today
to produce about the same gas volumes as it did in 1989.
- In September 2008 there
were over 2000 rigs drilling in the US. As of July 2009 there
were less than 800 rigs drilling. This is the fastest
drawdown in US history.
- The current rig count of less than 750 is
the lowest it has been since 1999.
2003 - |
$5.38 |
2006 - |
$7.24 |
2004 - |
$6.14 |
2007 - |
$6.84 |
2005 - |
$7.32 |
2008 - |
$7.58 |
