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Current Issue Contents - May 2020

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Despite an increasing appetite for natural gas in power generation as well as growth in industrial and commercial usage, the unabated growth in natural gas production has exceeded demand, keeping margins tight. But after weathering years of relatively low prices, gas-weighted producers are seeing reasons for renewed optimism. The May cover story features a conversation with gas market expert Andy Weissman, who offers reasons to look beyond short-term dynamics. Weissman points to a confluence of factors, including the continued build-out of LNG exports and falling associated gas output, while asserting that even a normal heating season storage draw could be a game-changer. The Dry Gas Strategies section dives into the activities of companies that already see a bright future, from the Appalachian Basin to Wyoming’s Jonah Field. That presumption is affirmed by Scott Tinker, the world-renowned energy authority at the Bureau of Economic Geology at the University of Texas. This month’s Production & Processing reports delve into a new approach for removing hydrogen sulfide, and look at new engine and gas compression technologies. Association news includes issues updates for CIPA and KOGA. Cover image by Archrock. Issue photography courtesy of Montage Resources, Freeport LNG Development, LP and Streamline Innovations.

NATURAL GAS OUTLOOK

COVER STORY: While the past decade has been largely about tight oil activity, the first several chapters of the U.S. shale story were written in dry gas basins. With today’s events dramatically reshaping energy markets, the industry is poised to turn its attention back to the future: dry gas. Part of the impetus comes from what already has transpired in America’s tight oil plays, tempering the unabated growth of associated gas. In this context, natural gas prices are showing surprising resiliency, and they could strengthen considerably in the coming winter. Assuming normal temperatures, the market is expected to tighten a great deal during 2021 and remain relatively tight into 2022. This will not only support higher prices, but also prompt dedicated dry gas drilling activity levels not seen in years. | Special Q&A With Andy Weissman

DRY GAS STRATEGIES

  • America’s Operators Find Opportunities In Dry Gas Plays: Thanks to years of associated gas growth in tight oil plays, the number of drilling rigs dedicated to natural gas drilling has remained relatively constant at 20 percent of U.S. land drilling. That may be about to change in a big way. | by Dan Holder
  • Gas Retains Key Role In Energy Future
  • Analysis Says Global LNG Demand Shows Resilience
  • IHS Markit: Shut-In Crude Output Could Hit 14 MMbbl/d Before July

PRODUCTION & PROCESSING

  • Advanced Technologies Create New Way To Remove Hydrogen Sulfide: As existing natural gas wells age, hydrogen sulfide becomes a greater concern. A new process employs advanced regenerative chemistries and control systems to cost-effectively remove H2S from wellhead and other gas streams. | by John C. Bourdon, Peter J. Photos and F. Hailey Brown