EIA's Annual Report Shows Natural Gas Reserves Up 2%, Sparked by Unconventional Resources
The Energy Information Administration's (EIA) annual report on U.S. natural gas reserves released last Monday was a mixed bag, with an increase in proved reserves of about 3.5 Tcf, down from last's year's stellar 6 Tcf, but slightly above the previous 10-year average of 3.2 Tcf.
One key statistic was that new field discoveries were 1,332 Bcf or 63% less than 2001 and 24% less than the prior 10-year average. Unconventional resources showed the greatest gains, EIA said in an advance summary of its "2002 Annual Report on U.S. Crude Oil, Natural Gas and Natural Gas Liquids Reserves."
The 2002 proved gas reserve increase was 2%, or 3,486 Bcf, bringing the total to 186,946 Bcf or nearly 187 Tcf. Natural gas reserve additions were 118% of production, EIA said, but it noted that production was down 2%. The 2002 additions to reserves were a little more than half the 6,033 Bcf of reserves added in 2001. Both the Rocky Mountain states and Texas had large reserve additions, highlighting "a shift from conventional gas fields to unconventional gas fields, i.e. tight sands, shales and coalbeds."
"Eleven of the top natural gas fields of 2002 are located in the Rocky Mountain states," the EIA report said. "Significant reserves were added in the Powder River Basin coalbed methane fields and the Pinedale Field (deep and tight sand) in Wyoming, and the Wattenberg Field (tight sand) and coalbed methane fields in Colorado. In Texas, significant reserves were added in the Newark East Field (Barnett shale), the nation's 10th largest natural gas field."
EIA noted that because a large part of the reserve additions were coalbed methane, which carries no liquids, natural gas liquids reserves remained about level between 2001 and 2001.
Total discoveries of dry gas reserves were 17,795 Bcf in 2002, compared to 22,758 Bcf in 2001. The 2002 discoveries, however, were 36% more than the prior 10-year average. "The majority of natural gas total discoveries in 2002 were from extensions of existing conventional and unconventional gas fields," which left new field discoveries lagging.
New reservoir discoveries in old fields were 1,694 Bcf, down 40% from 2001 and down 31% from the prior 10-year average. Coalbed methane proved reserves were 18,491 Bcf, an increase of 5% from 2001. They accounted for 10% of U.S. dry gas proved reserves. Coalbed methane production was 1,614 Bcf, an increase of 3% from 2001, and accounting for 8% of U.S. dry gas production.
EIA points to other natural gas features of 2002:
- Exploratory gas well completions decreased 30% and development well drilling was down 28%.
- Natural gas prices were down 27% to an average of $2.95/Mcf at the wellhead, compared to $4.02/Mcf in 2001.
- Production was off sharply in the Gulf of Mexico, but, EIA noted two severe hurricanes, Isadore and Lily, contributed to the decline.
EIA estimated proved reserves of crude oil increased 1% to 22,677 million barrels in 2002. Natural gas liquids were flat at 7,994 million barrels.
To access the EIA advance report visit: http://www.eia.doe.gov/oil_gas/fwd/adsum2002.html .
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