NGSA Predicts Record Natural Gas Demand and ‘Robust’ Production This Winter

In its latest Winter Outlook for Natural Gas, the Natural Gas Supply Association (NGSA) predicts the United States will experience record demand for natural gas, surpassing levels seen during the 2013-2014 “Polar Vortex.” To meet this demand, NGSA forecasts significant growth in production over the coming winter – an estimated eight percent to be exact – a vast majority of which will be providing by shale development.

According to the outlook, several factors are expected to contribute to increasing natural gas demand this winter, the most significant being weather. As NGSA notes, the National Oceanic and Atmospheric Administration (NOAA) estimates that this winter will be 12 percent colder than the relatively mild winter the U.S. experienced last year. Because of this, the group predicts that total heating degree days (HDDs) will be “significantly greater” this winter than the previous one, increasing demand for natural gas.

In addition to weather, NGSA also predicts that increased demand for natural gas from various economic sectors will push overall demand for the fuel up by about 3.2 billion cubic feet (Bcf) per day – an increase of roughly four percent. The majority of this demand will be derived from the residential and commercial sectors, but the industrial sector is also expected to contribute growth of about 0.7 Bcf per day derived from the construction of new gas-intensive projects and capacity expansions from petrochemical facilities.  Moreover, increased natural gas exports via pipeline to Mexico and liquefied natural gas (LNG) exports are expected to further raise demand, as foreign countries increasingly look to natural gas for a cleaner-burning fuel source.

Scott Moore, Chairman of NGSA and Senior Vice President of Anadarko Petroleum Corp., neatly sums up these demand pressures, stating:

“The picture that emerged for the upcoming winter is of a natural gas market experiencing substantial growth in both demand and supply.  Record demand in the residential and commercial sector is primarily driven by colder weather, with a longer-term shift to natural gas in the electric and industrial sectors driven by competitive prices and environmental benefits.”

As stated earlier, NGSA expects increased natural gas production — made possible by fracking — to increase as well to meet this demand growth. U.S. Energy Information Administration data shows that U.S. natural gas production has increased by almost 39 percent from 2006 to 2016, and Moore mentions this impressive production growth – as well as fracking’s role in it – stating:

“The shale revolution has ushered in a remarkable era, as evidenced by dramatic growth in production over the last 10 years. Drilling efficiencies continue to keep production flowing and new pipeline infrastructure can bring it to customers.”

Overall, with demand expected to reach record highs in the coming months, it’s great to know that American producers will be ready to meet this demand – and then some – thanks to continued technological advances in shale development.

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