NatGas Prices Stays High Even Tho M-U Hits Record High Production
The price of natural gas has almost doubled over the past year. In September 2020 the NYMEX Henry Hub price stood at $2.41/MMBtu. Yesterday the price closed at $4.64/MMBtu. Astonishing! The question keeps coming: Why is the price of natgas high and staying high, even though production in the country’s largest shale gas basin–the Marcellus/Utica–is on the rise? It’s a paradox. The short answer is that (1) production in other basins has not bounced back like the M-U following the pandemic, and (2) there is more demand, in the form of exports, for American natgas (via pipeline and LNG). Increasing demand with the same or less supply equals higher prices.
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In January MDN told you that UGI Corporation, one of Pennsylvania’s largest natural gas utility companies, wants to buy Mountaineer Gas Company, one of West Virginia’s largest natural gas utility companies, for $540 million (see 
Looking for a great job? Looking to work hard, but make excellent money for your hard work? If you live in Ohio, the answer to your job search lies in the oil and gas industry. The Ohio Oil and Gas Energy Education Program (OOGEEP) says there are more than 75 types of jobs in the Ohio oil and gas sector, with many jobs in welding, truck driving, and engineering. As of Aug. 19, there are 1,140 jobs available. And get this: Careers in oil and gas pay on average $30,000 more than other fields and average roughly $81,000 a year!
Whether we think it’s a good idea or not (we don’t), there is no denying that the Marcellus/Utica industry has collectively jumped off the RSG/ESG cliff. RSG stands for “responsibly sourced gas” and ESG is “environmental, social, governance.” Responding to pressure from investors and customers, most M-U drillers are now making moves to prove the natural gas they produce has been produced using practices that protect the environment. We say the gas has always been produced responsibly and we have nothing further to prove, but hey, who are we? The latest to join the crowd is Seneca Resources. The company announced yesterday will use Project Canary to certify its natural gas.
The latest weekly Enverus U.S. rig count shows total rigs regained some recently-lost ground to hit almost a new post-pandemic high. For the week ending September 2, the rig count stood at 623, up 2 rigs from the previous week. The Marcellus stayed even and the Utica lost 1 rig from the previous week. Collectively the M-U currently operates 44 rigs.
MARCELLUS/UTICA REGION: Bipartisan vote by PA House Committee approves resolution to carbon tax; Yaw angry over greenhouse gas compact vote; NATIONAL: The growing misuse of satellite monitoring data; US weekly LNG exports and Henry Hub climb; Fleet investment in near-zero emission natural gas trucks increases; New research raises concern about electric vehicles’ prospects; INTERNATIONAL: UK faces stark energy choice.