July 18, 2019
By Alex Mills
The future of the natural gas industry looks bright as supply and demand are expected to increase, and prices are predicted to be stable.
Demand increases will come from the electric power sector and exports, according to the Energy Information Administration at the Department of Energy.
EIA forecasts natural gas consumption by the electric power sector to increase by 1.1 billion cubic feet per day (Bcf/d), or 3.8 percent, from 2018 “as a result of favorable natural gas prices and coal-to-gas swithching.”
Even though the electric power sector is the largest consumer of natural gas, residential and commercial uses are important parts of the total consumption picture. Residential use is forecast to be flat for the remainder of the year, but use by the industrial sector will grow 2.5 percent in 2019, EIA predicts. “Low natural gas prices in recent years have made it economical to use natural gas as feedstock in fertilizer, methanol, ethylene, propylene, and polyethylene facilities,” EIA notes.
EIA estimates that total U.S. natural gas consumption averaged 82.1 Bcf/d in 2018, and EIA expects it to increase by 2.5 Bcf/d (3.1%) in 2019 and then remain almost flat in 2020.
EIA expects large production gains experienced recently to slow somewhat. During the first half of 2019, EIA estimates that dry natural gas production averaged 89.9 Bcf/d, a 12.2% increase from levels in the first half of 2018. In the second half of 2019, EIA expects dry natural gas production to average 92.7 Bcf/d, a 7.1% increase from the second half of 2018….