Supplies Could Diminish for Natural Gas Reserves
Fears, Ronda, THE JOURNAL RECORD
Based on a review of annual reports and Securities and Exchange Commission filings by the top 30 gas reserve holders, the industry association estimates that 1989 gas reserve replacement was between 86-104 percent in the Lower 48 states.
Reserve additions for the 30 companies totaled 7.44 trillion cubic feet, compared with 8.4 trillion cubic feet of production.
The American Gas Association said in recent years, the top 30 producers have accounted for 39-52 percent of total reserves.
Rauscher Pierce Refsnes Inc. of Dallas has upgraded its deliverability model due to the newer reserve data to show a surplus of 1.3 trillion cubic feet vs. 700 billion cubic feet earlier, but has also noted a continuance of demand growth as high as 5 percent.
"Despite better than expected reserve additions in 1989, the gas surplus should continue to diminish over the next year or so," said analyst Thomas A. Escott with the Rauscher firm.
"Demand could remain a substantial position wildcard in even our near-term outlook. In addition, the possibility of shortages in the 1991 to 1994 period is still very real, unless the drilling response is even greater than it has been over the past several years."
Taken alone, this development could be construed as a somewhat negative near-term investment factor, said Rauscher analyst Robert E. Phaneuf. But, he said, positive trends influencing gas demand may more than offset the increase. …