Natural Gas Production Increases Despite Fewer Rigs

According to an article by Bloomberg, the United States has almost three times as much recoverable natural gas as the government projects. The estimated volume would place the U.S. third in the world in terms of confirmed, recoverable natural gas. Furthermore, the article also states that rising shale output has helped increase the amount of gas in storage to a record seasonal high of 3.653 trillion cubic feet. In fact, the storage amount in March was 60 percent above the five- year average. Manuj Nikhanj, head of energy research at brokerage ITG Investment Technology Group Inc. (ITG) in Calgary, recently stated that data from greater than 24,000 recently drilled wells demonstrates that the U.S. has 890 trillion cubic feet equivalent of recoverable natural gas. In 2010, the Energy Information Administration (EIA) estimated a volume of 317.6 trillion proved reserves. BPs Statistical Review of World Energy published at the end of 2011 estimated U.S. gas reserves at 299.8 trillion cubic feet.

https://pbs.twimg.com/media/A47iX8aCYAAy20C.jpg:large

The chart above clearly demonstrates the integral role TAP Management and other independent energy producers play in meeting American energy needs. Although the number of natural gas rigs in the U.S. is falling to unprecedented levels, production rates are quickly expanding.

The number of natural gas rigs in the United States fell in July to 522. This is well below the calculated level of 608 back in January 1998. The total rig count fell to 437 just weeks ago, the lowest documented level since 1996. In 2008, there were roughly 1,600 natural gas rigs in the U.S. This means that the current rig count today is more than 70 percent below the peak period. Meanwhile, the U.S. natural gas production continues to climb. Furthermore, the 12-month moving average of gross natural gas extraction reached a record-high level in July. Compared to 1998, the U.S. is now producing 25 percent more natural gas with significantly fewer rigs. This demonstrates stark gains in productivity and efficiency for natural gas drilling. TAP Management Inc. | 515 Congress Avenue, Suite 2525 | Austin, TX | (512) 527-6000