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From the Desk of the President: What's in store for U.S. Energy in 2019?

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2018 was a banner year for the U.S. energy industry—one that influenced the way that business owners large and small use, pay for, and think about their power supply. What stood out in the U.S. energy landscape last year, and what’s in store for 2019?

Direct Energy Business President John Schultz recently offered his insights and predictions on the U.S. energy scene. Hear directly from him below: 

 

A Record-Breaking Year for Energy Production

In many respects, 2018 was a record year for U.S. energy production.

U.S. production of crude oil peaked at 10.7 million barrels per day—a level that puts it on par with global producers like Russia and Saudi Arabia. 2018 production levels represent an increase of nearly 14 percent compared to average production in 2017, according to the U.S. Energy Information Administration. 

U.S. natural gas production also increased to a record of 81 billion cubic feet per day, a 10 percent increase compared to 2017 levels. But don’t be surprised if that record is short-lived. The U.S. closed out 2018 by producing around 84 billion cubic feet of natural gas per day, a level that figures to be sustained throughout 2019. 

“We are doing that with a rig count that is basically half of what it was three to four years ago, which speaks to the improvements that the industry has made in terms of drilling and completing wells,” says Direct Energy Business President John Schultz. 

Natural Gas Goes International

For the first time in 60 years, the U.S. became a significant net exporter of natural gas in 2018. Due in part to improved transmission methods and an increased global demand for power, the U.S. was a net exporter of about two billion cubic feet of natural gas per day. In 2019, the U.S. could be a net exporter by as much as five billion cubic feet per day. 

Price Point Supports Global Growth

In the U.S., there’s an ample supply of natural gas available in the range of 3.00-$3.50 MMBtu. For producers, that’s a price that supports the majority of energy markets—both domestically and internationally. 

“Drilling gas, producing, transporting it to the U.S. Gulf Coast, liquefying it, shipping it around world—at this price point, the economics still work even with all of those costs,” Schultz says. 

The global demand for natural gas figures to play a larger role in the domestic supply picture, with the U.S. Department of Energy projecting that the U.S. will become an overall net energy exporter by 2020. 

Explore other installments from John Schultz in the series below, or watch the complete interview now.

Posted: January 09, 2019

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