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Rising U.S. nat gas prices may make exports less competitive

  • U.S. natural gas may not end up being as cheap as expected in the long term, as higher production costs and stronger demand make exports less competitive on the global marketplace, energy company executives say.
  • Henry Hub prices are in one of the low price cycles and below replacement costs, which can't be sustained if history is a guide, says Exxon (XOM) global LNG V.P. Richard Guerrant.
  • Looking forward to 2020-25, producing only the dry shale gas without the associated oil won't be profitable at $4 or $5/M BTU, says ConocoPhillips' (COP) V.P. of Commercial, Business Development and Corporate Planning Don Wallette.
  • ETFs: UNG, GAZ, UNL, NAGS, DCNG, BOIL, KOLD, UGAZ, DGAZ, FCG, GASL, GASX.
Comments (1)
  • User 353732
    , contributor
    Comments (4785) | Send Message
     
    Even at $5.00 per MMBtu both petrochemical and LNG exports and pipeline exports to Mexico are readily competitive . Moreover the supply response at such a price would be dramatic making $5/mmbtu(in real terms) a ceiling rather than a new floor.
    There is a great deal of dry gas production that is profitable at $4.50/mmbtu.
    Moreover, wet gas production will continue to increase over the next 5 years at least mitigating the need for dry gas output.
    14 Oct 2013, 12:43 PM Reply Like
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