Tuesday, April 8, 2014

The Market Is Ignoring the Demand Side of the Natural Gas Equation


The past couple of years there has been focus on increasing natural gas supplies, but most ignore surging demand that isn't being met with higher drilling. With natural gas inventories plunging to 11-year lows last week, the market needs to start including the demand side in the equation. One of the best examples of the increase in demand is the recent facility built by Nucor  (NYSE: NUE  ) in La.

The biggest mistake most make is assuming that abundant supplies in the ground will turn into production by E&P companies. The ironic part of the equation is that producers have left natural gas areas of the Haynesville Shale, (and other surrounding plays), while industrial and chemical plants are moving into the Gulf Coast.

Read the full article here.


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