PPT Slide
Natural Gas Productive Capacity for the Lower-48 States
- The Lower-48 States were producing at rates close to 95 percent of estimated effective productive capacity in 1999 (Figure 1).
- Lower oil and gas prices in 1998 and early 1999 resulted in reduced gas rig counts and new gas well completions, causing wellhead capacity to drop. The gas completions which include both new wells and recompletions of existing gas wells did have a small increase in 1999 (Figure 5).
- Higher drilling now and in the near future will increase effective productive capacity. The Low, Base, and High case projections of effective productive capacity through 2001 all indicate increasing future capacity.
- Due to high drilling rates, capacity utilization is trending down during 2001. If this trend continues during 2002, capacity utilization could drop below 90 percent, the level that indicates a “tight” natural gas market.
- Capacity utilization below 90 percent would create the potential for lower and less volatile natural gas prices.