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American Gas Association Executive Conference – EIA

EIA · Oct 11, 2010 · 27 slides

Investor presentation from the Shale Experts oil & gas presentation and slide database. Every page is imaged and its text indexed for search across operators, plays, basins and time.

Slides

  1. American Gas Association Executive Conference – EIA – slide 1
    Outlook for Natural Gas American Gas Association Executive Conference October 11, 2010 Chicago, IL Richard G. Newell, Administrator
  2. American Gas Association Executive Conference – EIA – slide 2
    Current Role of Natural Gas and Short-term Price Outlook Richard G. Newell, American Gas Assoc. 10/11/2010 2
  3. American Gas Association Executive Conference – EIA – slide 3
    U.S. primary energy consumption was 83% fossil-fueled in 2009 Total 94.6 Quadrillion Btu Richard G. Newell, American Gas Assoc. 10/11/2010 Source: EIA Annual Energy Review 2009 3
  4. American Gas Association Executive Conference – EIA – slide 4
    EIA recognizes that natural gas price forecasts are highly uncertain Henry Hub natural gas price dollars per million Btu History Projections 12 Historical spot price 10 STEO price forecast NYMEX futures price 8 95% NYMEX futures…
  5. American Gas Association Executive Conference – EIA – slide 5
    The probability of January 2011 contract month natural gas price being higher than 5.50 is less than 10% probability of exceedence 40% 30% 20% 10% 0% 4.50 5.50 6.50 dollars per million btu Source: EIA Oct 1, 2010;…
  6. American Gas Association Executive Conference – EIA – slide 6
    Long-term Supply and Demand for Natural Gas: Insights from the Annual Energy Outlook Richard G. Newell, American Gas Assoc. 10/11/2010 6
  7. American Gas Association Executive Conference – EIA – slide 7
    Non-fossil energy use grows rapidly, but fossil fuels still provide 78 percent of total energy use in 2035 quadrillion Btu History Projections 120 Renewables (excluding liquid biofuels) 100 Liquid biofuels 80 Liquid fuels 60…
  8. American Gas Association Executive Conference – EIA – slide 8
    Assuming no new policies, growth in energy-related CO2 is driven by electricity and transportation fuel use 2008 2035 Buildings and Electric Power Buildings and Electric Power Industrial 2,359 (41%) Industrial 2,634 (42%) 1,571…
  9. American Gas Association Executive Conference – EIA – slide 9
    U.S. Gas Production Richard G. Newell, American Gas Assoc. 10/11/2010 9
  10. American Gas Association Executive Conference – EIA – slide 10
    Import share of natural gas supply declines as domestic production grows trillion cubic feet History 2008 Projections 30 25 Consumption 6% STEO Net imports 13% 20 Domestic production 15 10 1990 1995 2000 2005 2010 2015…
  11. American Gas Association Executive Conference – EIA – slide 11
    Shale gas and Alaska production offset declines in other supply to meet consumption growth and reduce imports U.S. gas production + net imports trillion cubic feet History Projections 25 Net imports Alaska 20 Shale gas 15 10…
  12. American Gas Association Executive Conference – EIA – slide 12
    Fifty-five percent of active rotary rigs are now drilling horizontal wellbores active drilling rigs 2,500 Horizontal Directional Vertical 2,000 1,500 1,000 500 0 Jan- 2000Jan-2001 Jan- 2002Jan- 2003Jan- 2004Jan-…
  13. American Gas Association Executive Conference – EIA – slide 13
    Since 2006 the 6 largest shale gas plays have provided essentially all gross gas production increases in U.S. lower-48 gas production U.S. lower-48 (includes shale) gas production big 6 shale plays billion cubic feet per day billion…
  14. American Gas Association Executive Conference – EIA – slide 14
    U.S. shale gas production has increased 14-fold in 10 years annual shale gas production trillion cubic feet 5.0 4.5 4.0 Antrim Barnett Fayetteville Woodford Haynesville Marcellus 3.5 Eagle Ford 3.0 2.5 2.0 1.5 1.0 0.5 0.0…
  15. American Gas Association Executive Conference – EIA – slide 15
    Shale gas production significantly lowers projected U.S. gas imports total U.S. natural gas imports Two alternate scenarios trillion cubic feet 5 No new U.S. shale scenario allows no new onshore, lower 48 shale drilling after 2009…
  16. American Gas Association Executive Conference – EIA – slide 16
    U.S. Gas Consumption Richard G. Newell, American Gas Assoc. 10/11/2010 16
  17. American Gas Association Executive Conference – EIA – slide 17
    As over the past decade, developments in the electricity sector drive changes in overall demand for natural gas trillion cubic feet 10 History Projections 8 Electric Power Industrial 6 Residential 4 Commercial 2 Lease and…
  18. American Gas Association Executive Conference – EIA – slide 18
    Growth in electricity use continues to slow 3-year rolling average percent growth Period Annual Growth History 1950s 9.8 14 1960s 7.3 1970s 4.7 12 1980s 2.9 1990s 2.4 10 2000-2008 0.9 2008-2035 1.0 8 Projections 6 4 2 0…
  19. American Gas Association Executive Conference – EIA – slide 19
    Renewables gain electricity market share; coal share declines billion kilowatthours and percent shares 6,000 History Projections 5,000 17.0 4,000 Renewable 9.1 20.8 Natural gas 21.4 3,000 2,000 48.5 Coal 43.8 Oil and other…
  20. American Gas Association Executive Conference – EIA – slide 20
    Natural gas and renewables account for the majority of capacity additions from 2008 to 2035 2008 capacity Capacity additions 2008 to 2035 Hydropower* 99 (10%) Hydropower* 1 (0.4%) Nuclear Nuclear Coal 8 (3%) Coal 101 (10%) 312…
  21. American Gas Association Executive Conference – EIA – slide 21
    Climate policy and other drivers affecting the demand for natural gas in electricity generation and transportation Richard G. Newell, American Gas Assoc. 10/11/2010 21
  22. American Gas Association Executive Conference – EIA – slide 22
    So, what is the impact of energy, climate, or other pollution policies on the use of natural gas for electricity generation What is the implicit value of carbon What are the emissions targets To what extent are offsets allowed or…
  23. American Gas Association Executive Conference – EIA – slide 23
    Climate policy impact on operating costs: Existing plants Fuel cost for existing coal and combined cycle natural gas units with a value placed on carbon dioxide emissions Climate policies affect the operating costs of both coal-fired…
  24. American Gas Association Executive Conference – EIA – slide 24
    Levelized costs are needed to compare the impact of climate policy on investment decisions Levelized costs for new plants in 2025 with a value placed on carbon dioxide emissions Levelized cost, which considers 2008 dollars per…
  25. American Gas Association Executive Conference – EIA – slide 25
    Incentives for using natural gas to fuel heavy trucks are under active discussion in Congress AEO2010 includes sensitivity cases examining the impact of tax credits aimed at stimulating natural gas use in heavy duty (class 3 through…
  26. American Gas Association Executive Conference – EIA – slide 26
    Natural gas fuel use by heavy-duty natural gas vehicles in Base Market and Expanded Market case with Reference case world oil prices, 2010- 2035 trillion cubic feet 2.0 2027 Phaseout Expanded Market 1.5 1.0 0.5 2019…
  27. American Gas Association Executive Conference – EIA – slide 27
    For more information U.S. Energy Information Administration home page www.eia.gov Short-Term Energy Outlook www.eia.gov/emeu/steo/pub/contents.html Annual Energy Outlook www.eia.gov/oiaf/aeo/index.html International Energy Outlook…

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