However, regional transportation capacity limits are now reducing overall drilling activity in the region. Production growth in the Appalachia region over the past 10 years has been aided by improved productivity from wells drilled, pipeline buildouts, and increased takeaway capacity. Rig activity in the Appalachia region has returned to similar levels to those at the beginning of the COVID-19 pandemic, at around 50 natural gas-directed rigs. Gulf Coast draws operators to the region. In addition, the Haynesville region’s greater well productivity and its proximity to liquefied natural gas export terminals and major industrial natural gas consumers along the U.S. As natural gas prices remain elevated, drilling in the Haynesville region remains economical, even though Haynesville wells are relatively deeper and more expensive to develop. Most of the growth in natural gas-directed rigs has been concentrated in the Haynesville region where the rig count increased by over 50% between March 2020 and July 2022. dry natural gas production to generally increase through the end of 2023, averaging about 100.3 Bcf/d in December 2023. Our August Short-Term Energy Outlook (STEO) estimates that dry natural gas production in the United States averaged 96.4 billion cubic feet per day in (Bcf/d) in July 2022. The number of gas-directed rigs has averaged 160 rigs so far in August.Īs drilling activity increases, we expect that dry natural gas production will rise. Since then, the rig count has been generally increasing and reached pre-COVID levels in January 2022. The number of natural gas-directed rigs decreased throughout the first half of 2020 and fell to 68 rigs by late July 2020, the fewest in Baker Hughes’s history back to 1987. Rig counts had generally been falling through 2019, and in March 2020-around the start of the pandemic-106 natural gas-directed rigs were active, according to data from Baker Hughes Company. natural gas producers are operating more drilling rigs now compared with the beginning of the COVID-19 pandemic in early 2020. natural gas-directed rigs rise above pre-COVID levels, raising natural gas production
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