Despite Historic Drop in Crude Oil, Pure Gas Plays Set to Rise

Austin, TX (September 9, 2020) — Enverus, the leading oil and gas SaaS and data analytics company, has released its latest FundamentalEdge report which reviews upstream and midstream activity in two active natural gas basins: the Appalachian, composed of the Marcellus and Utica shales in Pennsylvania and Ohio, and the Haynesville, in Louisiana and Texas. Along with the overall economy, the energy industry was drastically impacted by the COVID-19 pandemic. Operators were forced to readjust their 2020 plans as prices fell due to oversupply in the market. These revised 2020 activity plans called for reduced rig activity and reduced production outlooks from most operators, particularly those in oil-directed plays. The oversupply in the crude market and the subsequent price drop have lowered activity in crude-directed plays. While this activity reduction is needed to help balance the crude markets, associated gas in these areas will also be taken off the market as a result. To offset the drop in associated gas, dry gas plays will need to fill the gap — and this will require higher prices to incentivize production. “While the Saudi-Russian price spat earlier this year, followed by coronavirus pandemic, rocked crude oil demand, gas-reliant industries like heating and… continue reading

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Source: CTRM Center

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