Natural Gas Storage Hits A Record For First Week In June; The Bakken Turns Out To Be A Significant Contributor

This is really quite incredible when you think about it.

For newbies: the Bakken is considered an "oil" play. Somewhere between 93% and 95% of all hydrocarbon produced from the Bakken is oil; throw in condensates and "we" might be "pert near" 97%, leaving only about 3% of hydrocarbon production in the Bakken to be natural gas.

On the other hand, the Woodford, Haynesville, and Barnett are all considered natural gas plays.

I mention that because the amount of natural gas produced in the Bakken is in the same "ball park" as that produced in Woodford and Barnett. And compared to the overwhelming production in the Marcellus (and eventually the Utica), one can even argue that natural gas production in the Bakken is in the same "ball park" as that produced by the Haynesville.

I don't think that's hyperbole, considering how much the Bakken has been "choked back" with:

• fewer rigs (30 now, versus 200+ during the boom)
• fewer permits (maybe 50% less compared to the boom)
• less drilling (much less, compared to the boom)
• producing wells choked back and taken off-line for short periods each month
• inactive wells (around 1,500)
• DUCs (around 900)

The link: http://www.eia.gov/naturalgas/weekly/archive/2016/06_23/index.cfm. For the "Natural Gas Weekly Update" report released June 22, 2016.

Some data points from that release:

• working natural gas stocks hit a new record for the first week in June: over the 3 trillion cubic foot mark -- that's storage! -- storage hit 3 Tcf during the first week in June -- earlier in the refill season (April 1- October 31) than ever before
• the record set back in 2012 was erased 
• comparable to 2012, working gas stocks entered the refill season this year (2016) at a record high level, totaling 2.492 Tcf on March 31, 2016. That was 19 Bcf above the record set in 2012
• the EIA uses the phrase "considerably higher" to say where we are now compared to 2012 (the previous record year)
• despite this huge injection, total natural gas demand during this same period has exceeded both year-ago and 2012 levels -- a trend driven by power-sector consumption
• power burn: 26 Bcf/d; 10% greater than a year ago; 5% greater than 2012
• exports: to Mexico have more than doubled since 2012 to 4 Bcf/d; LNG up to 0.5 Bcf/d from negligible in 2012
• natural gas production has slowed in all seven of the shale-producing regions
• natural gas spot prices rose faster than futures contracts prices for next winter

Much, much more at the link.