White Papers US Gas and LNG Markets | Page 2

INTRODUCTION Even though drilling targeting natural gas has declined to a multi-year low, US gas production continues to increase as E&P companies grow oil production and with it, oil-associated gas. As noted by the Energy Information Agency (EIA), a new daily gas production record of 92.8 BCF per day was reached on August 19, 2019, up from about 72 BCF/day in January 2018. This substantial increase occurred even as the price of natural gas continued to slide, falling from approximately $3.20 in early 2018 to less than $2.30 at the end of August 2019. Since that time, prices have rebounded somewhat with the normal seasonality of the markets, trading in the $2.50 - $2.70 range in September, though they remain well below the same period in most previous years. Further, according to EIA forecasts 1 , little improvement is expected for the remaining months of 2019 and early 2020 as storage volumes are within normal ranges and production continues to keep pace with demand. 1) https://www.eia.gov/outlooks/aeo/data/browser/#/?id=13-AEO2019&cases=ref2019&sourcekey=0 © Commodity Technology Advisory LLC, 2019, All Rights Reserved.