IFO Reports PA Natural Gas Prices Increased 187.1% In Last Year, Higher Than Henry Hub Price
On November 22, the Independent Fiscal Office reported there was a 187.1 percent increase in the Pennsylvania price for natural gas since the third quarter of 2020, even higher than the 120.1 percent increase in the industry referenced Henry Hub price during the same period.
The IFO report says, "These prices have recorded significant gains due to the combination of weaker-than-usual supply growth and demand rebounding from closures and mitigation efforts related to the COVID-19 pandemic in 2020. Current forecasts project that prices will remain elevated in the near-term due to global supply and demand pressures."
The IFO reported there was a 6.8 percent increase in natural gas production in the third quarter over the same quarter in 2020 to 1,884 billion cubic feet of gas.
The third quarter growth was largely driven by September production, which grew by 11.3 percent from September 2020. This is the strongest year-over-year growth for a month of production since July 2019.
Production through September was 6.7 percent higher than the same period in 2020, nearly double the growth rate of 2020 full-year production.
There were 111 new horizontal wells spud in the third quarter of 2021. This figure represents no change from the same period in the prior year, and the second-lowest number of wells spud in a quarter in the last five years.
New wells spud-- opened for production-- have declined quarter-to-quarter throughout 2021.
[Posted: November 22, 2021]
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