August 9, 2011 / 5:17 PM / 8 years ago

UPDATE 1-EIA slightly lifts US natgas output growth estimate

 * EIA sees 2011 gas output up 3.68 bcfd from 2010
 * 2011 gas consumption seen up 1.22 bcfd from 2010
 (Adds consumption, LNG and price data, background)
 NEW YORK, Aug 9 (Reuters) - The U.S. Energy Information
Administration on Tuesday slightly raised its estimate for
domestic natural gas production growth in 2011, expecting total
output this year to be up 6 percent from 2010 levels.
 In its August Short-Term Energy Outlook, EIA said it
expected marketed natural gas production to rise by 3.68
billion cubic feet per day in 2011 to a record 65.51 bcf, up
slightly from its July outlook that had output this year at
65.39 bcf daily,
 EIA said much of the growth in 2011 gas output is centered
in onshore production in the lower 48 U.S. states, which will
more than offset projected declines in offshore Federal Gulf of
Mexico output.
 Gas production has been growing steadily since 2005,
primarily because of the boom in horizontal drilling in onshore
unconventional shale formations.
 Production growth in 2012 was expected to increase at a
much slower pace, gaining 0.61 bcf per day, or 0.9 percent.
 Total domestic gas 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 slightly lowered its forecast for U.S. natural gas
consumption growth this year, expecting average demand to rise
1.8 percent from 2010 levels to about 67.35 bcf per day,
slightly below its previous estimate of 67.43 bcf daily.
 Strong growth in the industrial and electric power sectors
should back 2011 consumption gains, particularly after record
heat in July stirred up a healthy increase in demand for air
conditioning across much of the nation.
 In 2012, the EIA sees total consumption rising another 0.7
percent to 67.83 bcf daily, as continued growth in industrial
and electric power demand offsets projected declines in
residential and commercial use due to an anticipated milder
 The EIA's 2012 demand estimate was up from its previous
estimate of 67.32 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 still 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 Asia
LNG prices, the EIA said. The forecast is unchanged from last
month's report.
 EIA expects Henry Hub natural gas prices NGc1 in 2011 to
average $4.24 per mmBtu, little changed from its previous
estimate but down 14 cents from last year's estimated average
of $4.38.
 In 2012, the EIA sees prices rising 17 cents, or 4 percent,
to $4.41 per mmBtu.
 (Reporting by Joe Silha; Additional reporting by Eileen
Moustakis in New York)

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