Abstract: U.S. Natural Gas Productivity

Philip H. Stark, John R. Butler, Jr.

Low levels of gas well completions from January 1991 through May 1993, coupled with a high percentage of low-capacity Section 29 gas wells and extended cold weather during the first half of 1993 accelerated shrinkage of the gas supply surplus that prevailed since the early 1980s. Section 29 tax credits presented a two-edged sword. Credits sustained many operators over the past decade but low average productive capacity of Section 29 wells impacted gas deliverability. Several methods, including comparison of gas test volumes with peak production, document the decline in excess productive capacity.

Two approaches were used to forecast future gas productivity. Vintage production, tying annual production volumes to the original bore hole completion year, were used to determine decline rates including production from recompletions. Gas production projections also were generated for about 130,000 gas wells representing 96% of U.S. gas well gas production. A base

case forecast assuming a moderate increase in gas well completions indicates that U.S. gas production could decline as much as 2.5 Tcf/year by December 1995. Increasing gas rig utilization to 50% with 1000 active rigs could sustain U.S. production at current levels. More robust U.S. drilling activity and addition of at least 1.5 Tcf/year in Canadian imports would be required to meet the 2.0 Tcf increase in demand that is forecast by 1996. An updated forecast predicts future US drilling rates that will be required to meet increased demand.

AAPG Search and Discovery Article #90986©1994 AAPG Annual Convention, Denver, Colorado, June 12-15, 1994