Natural Gas Opportunities

Transcription

1 Natural Gas Opportunities NAFTANEXT Summit Chicago, IL Erica Bowman, Chief Economist April 25, 2014

2 U.S. Natural Gas Reserves Source: Potential Gas Committee

3 Abundant Supply Estimates of U.S. Recoverable Natural Gas (trillion cubic feet) 4,000 Proved Reserves Non-shale Gas Resources Potential Shale Gas Resources Total Resource (Uncategorized) 3,600 3,545 3,350 3,105 3,000 2,688 2,543 2,836 2,000 2,074 2,170 1,981 2,335 2,203 2,100 2,102 1,532 1,414 1,268 1,312 1,235 1,619 1, Potential Gas Committee EIA CERA, MIT NPC, INGAA ICF

4 Reserves Volume and Cost U.S. & Canada Supply Curve $/mmbtu Dry Gas Resouce (TCF) Source: ICF, Assessment of NYC Natural Gas Market Fundamentals and Life Cycle Fuel Emissions, June

5 Price Projections Affordable 2011$/MMBtu $14 $12 $10 Henry Hub Spot Natural Gas Price Historic Projected $8 $6 $4 $2 CERA 2012 WoodMac2012 AEO 2014 ER ICF 2013 $ Source: EIA EIA Annual Annual Energy Outlook: Energy 2009, Outlook: 2010, 2011, 2009, 2012, 2010, , 2012, 2013 Henry Hub Hub Spot Spot prices prices (Actual prices: (Actual 2000 to prices: 2012) 2000 to 2012)

6 Natural Gas Production (TCF): Reference AEO Projection Range: AEO AEO 2014 ER AEO 2013 AEO 2014 ER U.S. Production

7 Technology Advancement Source: Fayetteville Play, Southwestern Energy

8 Natural Gas Consumption Historic U.S. Natural Gas Demand (billion cubic feet per day) Projected Pipeline Exports LNG Exports Electric Power Transportation Industrial Commercial Residential Projected Data Source: EIA Annual Energy Outlook: 2014 ER Historic Data Source: EIA Natural Gas Monthly, February

9 Demand Opportunity 110 EIA Annual Energy Outlook 100 BCF/D Low 2013 High 2013 Reference 2014 Reference ANGA Opportunity Source: EIA AEO 2013, 2014 ER; ANGA analysis

10 Employment Impacts from Additional Natural Gas Consumption Domestic Jobs Impacts of Alternative Uses of Natural Gas per 1 additional BCF/d Production Gas to Liquids Plants Liquefied Natural Gas Plants Methanol Plants Ammonia Plants Upstream & Midstream Jobs 13,000 Construction Jobs Operations Jobs Total 4, ,000 1, ,000 3,000 1,800 18,000 4,200 3,400 21,000 Source: ICF, Tech Effect: How Innovation in Oil and Gas Exploration is Spurring the US Economy, October

11 U.S. Industrial Project Announcements Legend

12 Natural Gas Liquids Since 2008, US NGL production has increased by 500,000 barrels/day. By 2020, NGL production is expected to reach 3.8 million barrels/day. This is an increase of 100% over current levels.

13 NGL and LPG Pipelines

14 Ethylene Production Low natural gas prices are creating an advantage for the U.S. and Canadian ethylene production. U.S. net exports of products created from ethylene are expected to rise significantly by 2025.

15 U.S. Fertilizer Production Operating rates in 2013 for US ammonia producers are estimated to have reach about 90% of capacity. Many new projects have been announced and will be starting up between 2016 and 2018.

16 U.S. Employment Contributions

17 Fundamental Shift in Outlook tcf Forecast of Natural Gas Imports (trillion cubic feet) AEO 2005 AEO LNG LNG Pipeline Pipeline Exports Imports Source: EIA Annual Energy Outlook 2005 & 2014

18 LNG Exports Astoria (Oregon LNG) DOE: Under Review FERC: Filed Capacity 1.2 Sabine Pass (Cheniere) DOE: Approved FERC: Approved Capacity: 2.2 BCF/d Coos Bay (Jordan Cove) DOE: Conditionally Approved FERC: Filed Capacity: 1.2 BCF/d Lake Charles (Truckline/Energy Transfer Partners, BG Group) DOE: Conditionally Approved FERC: Filed Capacity: 2 BCF/d Cameron (Sempra) DOE: Conditionally Approved FERC: Filed Capacity: 1.7 BCF/d Cove Point (Dominion) DOE: Conditionally Approved FERC: Filed Capacity:.8 BCF/d Elba Island (Southern LNG) DOE: Under Review FERC: Filed Capacity:.5 BCF/d Freeport LNG (FLEX Quintana Island) 2 Separate Filings DOE: Conditionally Approved FERC: Filed Capacity: 1.8 BCF/d Approved by DOE Waiting DOE Approval Lavaca Bay (Excelerate Liquefaction Solutions) DOE: Under Review FERC: Filed Capacity: 1.4 BCF/d

19 Infrastructure Requirements Through Average Annual Gas Well Completions (1000s) Oil Well Completions (1000s) Total Well Completions (1000s) 1, Miles of Transmission Mainline (1000s) Miles of Laterals to/from Power Plants, Storage Fields and Processing Plants (1000s) Miles of Gas Gathering Line (1000s) Inch-Miles of Transmission Mainline (1000s) Inch-Miles of Laterals to/from Power Plants, Storage Fields and Processing Plants (1000s) Inch-Miles of Gathering Line (1000s) 1, Compression for Pipelines (1000 HP) 4, Compression for Gathering Line (1000 HP) 8, Gas Storage (Bcf Working Gas) Processing Capacity (Bcfd) LNG Export Facilities (Bcfd) Source: INGAA Foundation Report (March 2014)

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