US Natural Gas Production Growth Waiting for New LNG Capacity

US natural gas production growth could be on pause until more LNG export capacity comes online later this decade according to panellists from Hart Energy's Super Dug conference.

• US gas production increased 5-6bcf/d in Jan to Sep 2022, mostly from Permian and Haynesville, but has largely stabilised since according to S&P Global. Production increased on higher global gas prices, expanded US LNG export capacity and increased domestic gas-fired power demand.
• Future Permian output is challenged by insufficient midstream capacity while new drilling in Haynesville is limited by relatively higher drilling costs and sharply lower gas prices.
• The panellists see the slowdown in gas production also driven by insufficient demand growth and inadequate midstream infrastructure and could be waiting for more LNG export capacity.
• LNG export terminals already under construction could increase export demand by 61m mt/year (8.3bcf/d) in the next five years and projects still in pre-FID phase could add another 250m mt/year of additional capacity within the next decade according to S&P Global.