National Energy Board anticipates holding pattern for natural gas production

The NEB looked at trends for natural gas deliverability within the country. Upon review, it determined there are three main supply and demand drivers that have a direct influence on future natural gas prospects in Canada.

The factors at hand include lessened drilling levels due to the low cost of natural gas, and growth in natural gas as a byproduct from developing oil as well as liquids rich developments.

Also fundamental is producers not making enough in return to attract more investment, as current prices are around $3.00/MMBtu in western Canada.

The NEB says a mid-range prices would mean moderate growth in North American natural gas demand, which could go along with a decline in the Canadian natural gas that’s delivered, and slowing U.S. supply growth.

That has the possibility to slowly lessen the excess availability of natural gas in North American markets.

It’s projected that Canadian natural gas prices will be $3.60/GJ by 2015, which might lead to a return to some dry gas drilling.