U.S. natural gas producers are starting to reduce drilling and investment as low prices affect their returns.
Reuters reported that U.S. natural gas** hit its lowest level in three-and-a-half-year years, which went against drillers' expectations for natural gas*** this year. Last year, due to **abundance, natural gas*** so, as they expressed in their financial report, they no longer waited *** but suppressed production.
Reuters, citing a report from Comstock Resources, said the company intends to reduce its existing rigs from seven to five. Not only that, but the company will also suspend dividend payments until the gas *** is enough to generate revenue for it. Another gas giant, Antero Resources, was quoted by Reuters as saying it planned to cut its drilling budget by more than a quarter and cut one rig from its three rigs, Reuters reported. Antero Resources also said it had reduced the number of completions personnel from two to one.
For the past year or so, natural gas in the U.S. has been high due to its strength, especially in the oil fields of shale regions, where natural gas is extracted as a by-product of the country.
But even in the gas extraction sector, drillers have been struggling to expand LNG exports as local demand remains relatively flat. Subsequently, Biden of the United States suspended the approval of new LNG export terminals. Among the motives for the move, the US White House mentioned the prospect of its domestic gas ***.
Earlier this month, as the weather began to warm and the peak demand season was coming to an end, natural gas** fell below $2 per million UK thermal units. This week, the U.S. House of Representatives passed a bill aimed at reversing Biden's suspension of new LNG capacity, but the bill has not yet passed the U.S. Senate and could die in the U.S. Senate, leaving the gas demand outlook unchanged. (Compiled by Xiao Chen).
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