EIA Says 2018 Biggest NatGas Production Yr Ever, Thx to M-U Pipes

Our favorite government agency, the U.S. Energy Information Administration, issued its latest Short-Term Energy Outlook (STEO) on Tuesday (full copy below). Most of the headlines in the media have been about EIA’s prediction that U.S. oil output will hit its highest level EVER in 2018. As in ever, in all of history. The simple reason for the record output is, of course, shale oil output–most of it coming from the once-sleepy Permian Basin in Texas. Something overlooked in yesterday’s report is that 2018 and 2019 will see the most U.S. natural gas output, EVER. EIA says that in 2018 the U.S. will average an additional 6.9 billion cubic feet per day (Bcf/d) of natgas production. That is “like the U.S. adding the entire output of Turkmenistan — one of the world’s largest gas exporters — in the space of just one year.” Astonishing! There are two reasons why natgas production will see an historic increase this year: (1) associated gas–the more you drill for oil in the Permian and Bakken, the more natgas molecules come out of the ground along with the oil; and (2) the main reason…new pipelines in the Marcellus/Utica. “Pipelines able to carry roughly 7 billion cubic feet of gas a day away from the prolific Appalachian region are due to start up this year, allowing production that’s been bottled up in the East to flood out.” Thank you Marcellus/Utica for lifting the entire country to new heights!…

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