Slide 15 of 17
Working gas in storage is estimated to have been about 2,425 billion cubic feet at the end of November, 14% below the previous 5-year average. The current outlook for winter demand and supply suggests that storage is headed for record lows this winter if weather is normal or colder than normal. In the base case, we project that gas storage will fall to about 640 billion cubic feet at the end of the heating season (March 31, 2001). The previous record low was 758 billion cubic feet at the end of the winter of 1995-1996. If summer gas demand next year is as strong as we currently expect it to be, the low end-winter storage levels will present a strong challenge to the North American gas supply system to maintain flexibility and provide additional gas in preparation for the subsequent winter season.
Based on the latest data relating to planned additions to U.S. electric generating capability over the next year (additions which will primarily consist of gas-fired units), we have increased our expected level of gas demand by the electric power sector from previous outlooks to 6.65 trillion cubic feet in 2001. That level is 3.4 % above the estimated level of 6.43 trillion cubic feet in 2000. The higher gas demand for power generation presumes a limited incremental propensity for switching to other fuels, including coal and oil, mainly due to environmental concerns. At the same time, we expect gas production in the United States to increase to 19.46 trillion cubic feet, about 3.6% above 2000 levels.