A new report by IHS Markit research claims natural gas production in the U.S. will swell another 60 percent in the next two decades.
The firm says the nation’s natural gas production already soared 60 percent in the past ten days following the country’s shale boom. And it believes there will be no letup in the coming 20 years according to the report entitled “The Shale Gale Turns 10: A Powerful Wind at America’s Back.”
The business information provider believes natural gas production will rise by nearly 8 billion cubic feet a day or more than 10 percent in 2018. The report also estimates that nearly 1,250 trillion cubic feet of U.S. supply is below $4 per MMBtu Henry Hub price, up from a previous estimate of 900 trillion cubic feet in 2010.
The U.S. was churning out about 50 billion cubic feet of gas a day through conventional production means before the boom, and that has since skyrocketed to an estimated record of more than 81 billion cubic feet daily this year – a 10 percent hike from 2017 – according to the U.S. Energy Department. The U.S. is by far the global leader in gas production.
A 60 percent spike from 2017 levels would calculate to about 118 billion cubic feet a day by the end of 2037.
Calling shale gas anything but a veritable revolution is a big understatement, said Dan Yergin, IHS Markit vice chairman and the report’s co-author.
“It represents a dramatic and largely unanticipated turnaround that dramatically changed both markets and long-term thinking about energy,” Yergin added. “The profound and ongoing impacts on the industry, energy markets, the wider economy and the U.S. position in the world continue to unfold.”
In terms of the electric grid, natural gas-fired power has become the nation’s leading source of electricity in a grid where growth was once dominated by coal and nuclear power. Natural gas is responsible for about one-third of all U.S. electricity now and that should grow to about 50 percent by 2040, according to the IHS Markit report.
Because the U.S. can only consume so much natural gas, much more of it will be exported in liquefied form. LNG exports are jumping from an average of 1.9 billion cubic feet a day last year to about 3 billion cubic feet this year. That should jump to more than 5 billion cubic feet a day next year as new projects come online along the Texas and Louisiana coastlines, according to the Energy Department.