In the U.S. Energy Information Administration’s (EIA) Annual Energy Outlook 2023 (AEO2023) reference case, US natural gas production is projected to increase 15% and LNG exports to increase 152% between 2022 and 2050. The EIA expects natural gas production to rise to 42.1 trillion ft3 by 2050. Production growth is largely driven by US LNG exports, which are expected to rise to 10 trillion ft3 by 2050. Natural gas production growth on the Gulf Coast and in the Southwest reflects increased activity in the Haynesville Formation and Permian Basin, which are close to infrastructure connecting natural gas supply to growing LNG export facilities.
In its AEO2023, the EIA explores long-term energy trends in the US and presents an outlook for energy markets through 2050. The EIA use different scenarios, called cases, to understand how varying assumptions affect energy trends. The AEO2023 Reference case, which serves as a baseline, or benchmark, reflects laws and regulations adopted through mid-November 2022, including the Inflation Reduction Act.
In the reference case, the EIA projects that annual natural gas production from 2022 through 2050 will grow by 52% on the Gulf Coast and by 50% in the Southwest. Because the Haynesville Formation and the Permian Basin are close to LNG export terminals in Texas and Louisiana, the amount of natural gas produced in these regions has grown along with the demand for LNG. Associated dissolved natural gas from oil formations, another notable contributor to natural gas production, contributes to production growth in the Southwest.
The EIA projects continued rising global demand for natural gas, which makes it economical to build additional LNG export facilities in the US. New liquefaction facilities in Louisiana became fully operational in 2022, ahead of schedule. In addition, new LNG trains in Texas are scheduled to be online by 2025.
Across some side cases, production increases are projected during the projection period. The most growth in US natural gas production is expected in the High Oil and Gas Supply case and High Oil Price case. In the Low Oil and Gas Supply case, US oil production declines, which reduces associated dissolved natural gas and shale production and shrinks natural gas production on the Gulf Coast and in the Southwest. In the Low Oil Price case, the EIA projects a lower Brent oil price, which reduces LNG exports below current levels in the near term through crude oil-linked international LNG pricing and results in under-utilised capacity by 2050. However, in this case, increased Gulf Coast shale production enables natural gas production in this region to grow through 2050, despite declines in all other regions.
Read the article online at: https://www.lngindustry.com/liquid-natural-gas/01052023/eia-us-natural-gas-production-and-lng-exports-will-likely-grow-through-2050/
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