Natural gas prognosticators see the gap in supply and demand
narrowing in 1989, with reserve replacements for last year estimated
between 90 and 105 percent and demand rising 11 percent over the
past two years.
"There is little doubt that as supply and demand move into
balance, probably within the year, there will be ample capacity to
develop a growing supply to meet a growing demand," said George H.
Lawrence, president of the American Gas Association.
The association made its conclusions based on data from annual
reports and filings with the Securities and Exchange Commission by
the 30 largest natural gas reserve holders. The analysis was
supplemented with similar information from distribution and
transmission companies that account for 12 percent of annual U.S.
natural gas production.
Reserve additions examined, in both new discoveries and
revisions, totaled 8,200 billion cubic feet, 47 percent higher than
reserve additions of the 30 top companies in 1987.
Based on those 30 companies' results, the gas association
estimated nationwide reserve additions of between 14,600 billion
cubic feet and 17,100 billion cubic feet.
New discoveries in 1988 were up 53 percent, while revisions rose
39 percent over the previous year.
Largest reserve additions were by Arco Oil and Gas Co., Amoco
Corp., Burlington Resources, Texaco Inc. and Chevron Corp., all of
which reported more than 650 billion cubic feet of reserve additions
Strong performance in reserve additions, Lawrence said,
- Renewed development in deep gas drilling of more than 15,000
- The discovery of significant new fields in the lower 48
- Greater influence of the U.S. natural gas resource base.
- The emergence of coalbed methane as a drilling target.
Arco and Amoco both have drilling activities in the deep
Anadarko Basin in west Oklahoma, the world's richest natural gas
reservoir where drilling is between 22,000 feet and 40,000 feet.
Arco also has a discovery well in the Arkoma Basin in southeast
Oklahoma where drilling is at about 15,000 feet.
Reserve addition figures were not available for Oklahoma, but in
1988, 1.708 billion cubic feet of natural gas was sold in the state,
compared to 1.599 billion cubic feet in 1987, according to records
filed with the Oklahoma Corporation Commission.
Lawrence emphasized that a particular reason for positive
reserve additions is the result of continued technological advances
in exploration and production techniques, including not only better
access to new natural gas in deep resources but improved geological
capabilities to evaluate conventional formations.
"It is noteworthy to remember that, for the 11 years prior to
the passage of the Natural Gas Policy Act of 1978, the replacement
ratio for the lower 48 states was only 46 percent," Lawrence said. .
- Proration, which brought order to the chaotic oil and gas
industry in 1914, marked its 75th anniversary Sunday.
It is a system of laws allowing all producers to share in the
available market in proportion to the amount of their production. …