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A deceleration in the growth of natural gas supply over coming years may be in the cards, posits...

A deceleration in the growth of natural gas supply over coming years may be in the cards, posits Robert Sinn, noting the price has now fallen below the all-in production cost for Ultra Petroleum (UPL), one of the industry's lowest-cost operators. Combined with the potential for increased demand, "it's possible to see some light at the end of today's dark tunnel."
Comments (4)
  • Agree you buy companies like UPL when they fear meter is high! They will be a survivor or bought out eight way now is the time to accumulate UPL is best in breed.
    3 Apr 2012, 10:17 AM Reply Like
  • Don't know much about UPL i see. Better you than me.
    3 Apr 2012, 10:20 AM Reply Like
  • The "poitential" for increased demand?

     

    I was just reviewing my local utility's (ED) gas switching programs and incentives and was astounded by how hard it is pushing nat gas conversions.

     

    Not to mention Mayor Bloomberg in NYC passed a law recently that will heavily encourage adoption of the fuel over oil, demand will certainly increase. (http://on.nyc.gov/HhZnIV)

     

    Does that mean I am bullish on the price of NG? Somewhat, but I think the divergence of the traditional NG/oil ratio isn't coming back and I think NG followed oil up in '08 because of the expectation that ratio would hold, but I think markets today have given up on that and won't chase NG behind oil.
    3 Apr 2012, 10:22 AM Reply Like
  • Whole industry is under water below $3 to cover their costs and particularly the majors who basically have huge costs in their on reserve inventory and even higher operating costs than the many independent companies who are suffering big time now except for the hedges they have left. Frankly if Exxon would join CHK and UPL and others in shutting in all of their gas except that required to meet their hedge obligations we could clean up the excess inventory due to warm winter and spring in a hurry. I find it ludicrous that the giant does not recognize its obligations to the domestic industry that has been suffering on their behalf because of the continued attacks on "big oil" which actually hits the small independents who drill over 90% of the wells and not a lay a glove on the big boys. Nevertheless I can see some small movement toward improving the oversupply and the steep declines of the shale gas wells in their initial year will help that along pretty soon.
    4 Apr 2012, 02:53 AM Reply Like
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