2001 Gas Balance: Soft Landing Case
An economic soft landing will keep market tight and prices well above historical range.
Industrial demand growth near zero
Demand revives rapidly when price in $4-6 range
Power capacity additions boost US gas demand
Eastern plant start-ups on schedule
Western plants accelerate
Belief in high price longevity
Activity remains very high
Structural obstacles increasingly important
Rising unit costs
Low productivity wells
Higher acquisitions costs
More focus on land access
Belief in high price longevity
E&P capex revised up
$ committed to remote gas
New rigs ordered
Those with the prospects and human resources for low-cost growth will emerge as winners.
Prices well above historical range for sustained period