Record Natural Gas Production, Record Consumption, Game Over - Tom Shepstone ReportsTom Shepstone
Shepstone Management Company, Inc.



The Energy Information Administration reports record natural gas production and record natural gas consumption. The game is all but over for fractivists.

The Energy Information Administration (EIA) just released its Natural Gas Annual report and it demonstrates the game is all but over for fractivists. Natural gas production is up, natural gas consumption is up, exports have increased more than imports and Pennsylvania is setting new records. It’s just one page of good data after another.

The EIA’s 2015 Natural Gas Annual is full of fantastic data showing just how far shale revolution has taken us. For those of us too close to the trees to see the forest, it’s one big eye-opener. Take the data on natural gas production from shale gas wells, for example.

natural gas production

Natural gas production from shale wells in the US has increased by 82% over five short years. Moreover, shale production as a share of total natural gas production has grown from 30% to 47%. That’s a revolution. Total natural gas production has grown by 16% over the same period. Natural gas consumption, while it didn’t quite pace production (hence the price declines) was also up a healthy 12%.

natural gas production - consumptionComparing these two charts, it becomes quite obvious why fractivists are putting so much effort into stopping pipelines. They view stopping the flow as the only way to choke off the revolution. They aim to keep prices so low as to be unprofitable, but industry innovation is constantly lowering the production cost per cubic foot of gas. They can’t win.

They’re also losing in another way. We are increasing exports faster while imports decline.

natural gas production - imports & exports

Yes, imports are down 22% and exports are up 18% since 2011. This positive set of trends can be expected to continue as more Marcellus Shale and other LNG makes it’s way to Europe. Most of those imports, come from Canada, which is a favored trading partner, but the imports from places such as Trinidad, Tobago and Yemen are only sustained by the obstinacy of politically correct New York and New England pols. They’d rather Boston would be dependent on foreign sources of gas than have an innocuous pipeline or two. Such is the idiocy of Northeast politics. This imports map from EIA explains:

natural gas production - imports

One really cold winter in the Northeast when there are both natural gas and propane shortages and spot prices spike to new highs is likely to change that, too. Pols now demagoguing against pipelines will quickly pivot, of course, and blame someone else. That’s the way of Northeast politics, after all. Meanwhile, though, the data speaks for itself. The shale revolution has conquered. Fractivism might as well be dead.



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9 thoughts on “Record Natural Gas Production, Record Consumption, Game Over

  1. Interesting. Now if fracticists see this report and it is likely they will one should watch what they do with it. A general rule of thumb for how they operate is to turn the data or information inside out or upside down.

    Now unfortunately in the activist and fractivist scene there is a lot of networking and sharing of information or rather misinformation and this has been ongoing for some time. The result is that in the present fractivist orgs are super confused as they have been misinforming each other for a long time and just about anyone else they come in contact with. It is a real mess.

    For sure reporters should be made aware that many of the sources they use for natural gas issues (like how pipelines are permitted, reviewed and whether or not ferc is a rogue agency possibly run by North Korea or not) are not super reliable and they need to get a handle on where to get at least some reliable information. When that will happen though? Who knows.

    • Hi! Anti-fracking advocate here. You asked, so here’s the argument I would use:

      A faster rate of production and consumption is irrevocably linked to a faster rate of depletion. This is true of any nonrenewable material, and it is true of natural gas. The faster we build more infrastructure to support the industry, the faster the day approaches when that infrastructure becomes obsolete.

      Hydraulic fracturing works more or less radially from a point source – a well. Because fracking has range restrictions, a single well can only collect gas from the vicinity of its borehole. When its supply is exhausted (i.e. it is no longer profitable to collect the remaining gas), a new borehole must be drilled in a different direction or a new well must be constructed.

      The production capacity of one well has a curve that approximates exponential decay, and the construction of additional pipelines in the Marcellus region will accelerate the depletion of natural gas in existing wells.

      Because the land area of Methane-rich deposits is finite, eventually it will be more expensive to construct and maintain wells and pipelines than it is to construct and maintain other sources of energy.

      At that point, all the resources (tax-funded subsidies, natural habitat, public and private property, the global temperature, air, soil, surface and groundwater quality) we sacrificed to support natural gas will be permanently lost to us.

      The materials from old operations could theoretically be recovered, but based on the track record of natural gas installations, that isn’t likely to constitute the majority.

      Even if industry projection are correct and shale gas at current levels of consumption will somehow last for “generations”, you can clearly see that the EIA data predicts accelerated growth. <- There's the "turning data upside-down" moment (I would argue that it's a legitimate interpretation of the facts, but who can say).

      The more this industry booms, the harder it will crash. I just hope y'all are prepared for that.

      • Chris, if you want to continue to comment, I suggest you use your real name and identify the fact your real motivation is opposition to the PennEast Pipeline. You’re a NIMBY.

  2. Those of us who are boosters of fossil fuel use, and the unconventional component in particular, would do well to continue the press for increasing infrastructure, ongoing education of the public as to the numerous industrial opportunities, the multi generational benefits in extracting and using this incredible hydrocarbon bounty.

    Our opponents WILL NOT cease in their ongoing efforts to derail this Shale Revolution.

    Two related events, one recently occurring in South Australia, and the second about to unfold in the coming weeks in New England, should provide concrete indications of the pitfalls of over reliance on ‘renewables’.

    The total blackouts that took place in Australia was 100% attributable to the large portion of electric power supplied via wind.
    It is not called intermittent for nothing.
    In this case, the high winds caused a shutdown of the units and an immediate 100% cessation of juice.

    In New England, local politicians who fended off pipeline development are now clamoring for LNG infrastructure build out so their constituents do not freeze in the dark in the coming winters.
    I’ll not try to explain the irrationality up there, but point out the VERY serious consequences that can and do happen when the idealism of ‘sustainability’ runs smack into the reality of sub zero temps, 85 mph winds, and all the the various (and expensive) fallout when sincere, ignorant people hold sway in these matters.

    No cooling off period.

    Keep talking, reading, communicating, showing up at events.
    There is an incredible resource beneath your feet in the Appalachian Basin.
    Don’t let it be taken from you.

    • Yes yes, of course. Methane distribution has never been interrupted. Nope. Never once. Deadly fireballs? Pshhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhh. Nope.

      Furthermore, this article points out that the power failure was ultimately caused by a combination of wind turbine shutdown and a grid overload at the interconnection point.
      One might easily argue that retrofitting current electricity grids for intermittent power could be a more efficient use of tax money than installing new natural gas infrastructure that could be obsolete in a few decades (see above), and something that would have prevented the blackouts.

      In addition, a larger geographical distribution of renewable infrastructure would be able to stabilize the system in the event of a power failure in one region – kind of like how electricity distribution works in general. The fault lays in our wires, not our turbines.

      Source for New England?

      Also, your last sentence – the anti-fracking folks are the ones trying to prevent the resources of the Appalachian Basin from being taken from the people of the Appalachian Basin. You’re thinking of the natural gas industry.

  3. Pingback: New York State's Natural Gas Hypocrisy

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