Today, EIA released it monthly report on natural gas production for December and while production was off .7% for the Lower 48 states the decline was less than anticipated. The decline in production from older conventional fields continues in such states as New Mexico and Texas but is increasingly being offset by growth from the newer shale fields in in Louisiana (Haynesville) and other states Arkansas (Fayetteville) and PA (Marcellus) fields. (See graph below).
This continued growth of newer shale production is helping to stabilize natural gas prices in what has been a colder than average winter. While storage may end the withdrawal season on March 31st at a deficit to year ago levels, the continued increase in horizontal drilling will likely lead to growth in natural gas production later in 2010.
