US gas output hit record in October: EIA

US gross natural gas production rose to a record high in October on gains in the key producing states of Texas, Oklahoma and Louisiana.

Gross gas production from the lower 48 states — which includes volumes that do not reach market — reached nearly 84 Bcf/d (2.4bn m³/d) in October, up by 627mn cf/d, or 0.8pc from a month earlier, the US Energy Information Administration (EIA) said in its monthly production report. October output was up by 6.4pc from a year earlier as the pace of drilling in oil- and gas-rich fields accelerated because of higher prices and as efficiency gains boosted the profitability of each new well.

US output has increased from year-earlier levels for five consecutive months ended in October. The surge in supplies has put downward pressure on gas prices and eased concerns about lower-than-average inventory levels this winter. Daily prices at the Henry Hub in December averaged $2.76/mmBtu, down by 23pc from a year earlier.

October gas output from Texas, the top producing state, was 22.4 Bcf/d, up by 2.4pc from September and 3.8pc higher than a year earlier. Production from Oklahoma increased month over month by 3pc to 7.3 Bcf/d and was 9pc higher than a year earlier.

Production from those states has been climbing as producers drill new oil wells in the Permian basin in west Texas and southeastern New Mexico and in the Stack and Scoop formations in Oklahoma.

Louisiana production was also up in October on a drilling rebound in the Haynesville shale, a gas-bearing formation under the northern part of that state and east Texas. Output from Louisiana rose to 6.5 Bcf/d, a 3pc increase from September and a year-over-year gain of 38pc.

Gas production from Pennsylvania, which sits atop portions of the prolific Marcellus and Utica shales, dropped to 14.5 Bcf/d, down by 2.1pc from a month earlier but 5.6pc higher than a year earlier. The month-over-month decline may reflect some shuttered production resulting from low prices and a downturn in demand related to mild October weather.

West Virginia output, also home to part of the Marcellus, increased to 4.7 Bcf/d, up by 0.7pc from a month earlier and 23pc higher than a year earlier, the EIA said.