July 12, 2011 / 4:39 PM / 9 years ago

UPDATE 1-EIA sharply raises 2011 US natgas production growth

   * EIA sees 2011 gas output up 3.56 bcfd from 2010
 * 2011 gas consumption seen up 0.58 bcfd from 2010
  (Adds consumption, LNG data, background)
 NEW YORK, July 12 (Reuters) - The U.S. Energy Information
Administration on Tuesday sharply raised its estimate for
domestic natural gas production growth in 2011, expecting total
output this year to be up 5.8 percent from 2010 levels.
 In its July Short-Term Energy Outlook, EIA said it expected
marketed natural gas production to rise by 3.56 billion cubic
feet per day in 2011 to a record 65.39 bcf, up sharply from its
June outlook that had output this year at 64.61 bcf daily,
 EIA said much of the growth in 2011 gas output was expected
to occur in the first three quarters of the year, with a more
moderate increase in the fourth quarter.
 Gas production has been growing steadily since 2005,
primarily because of the boom in horizontal drilling in
unconventional shale formations.
 Production growth in 2012 was expected to proceed at a much
slower pace, increasing 0.58 bcf per day, or 0.9 percent.
 With year-over-year 2011 production growth now seen
exceeding 2010's 4.5 percent increase, total domestic output
this year should easily set an all-time high, eclipsing the
previous record high, hit in 1973, of 62.05 bcf daily.
 The EIA raised its forecast for U.S. natural gas
consumption growth this year, expecting average demand to rise
2 percent from 2010 levels to about 67.43 bcf per day, more
than its previous estimate of 67.06 bcf daily. Strong growth in
the industrial and electric power sectors should back 2011
gains.
 But in 2012, the EIA sees total demand falling 0.2 percent
to 67.32 bcf daily, as declines in residential and commercial
consumption due to milder winter weather in the Midwest and
West offset continued growth in industrial and power sector
use.
 The EIA's 2012 demand estimate was up from its previous
estimate of 67.24 bcf per day.
 The agency recently said changes to its methodology in
collecting and reporting consumption data should not
significantly change reported total annual consumption volumes,
but it did expect significant changes in the seasonality of
reported residential and commercial demand volumes.
 U.S. imports of liquefied natural gas are expected to fall
nearly 17 percent from 1.2 bcfd in 2010 to 1 bcfd in 2011 and
2012, as increased demand in quake-hit Japan boosts LNG prices,
the EIA said. The forecast is unchanged from last month's
report.
  (Reporting by Joe Silha; Editing by Lisa Shumaker)


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