With about half of its North American natural gas producers’ first quarter results complete, Lehman Brothers believes U.S. production rose roughly 1.3% sequentially but decreased 2.5% from year-ago levels, while total Canadian production decreased 2.1% sequentially and also 2.5% from 1Q02.

Analyst Thomas Driscoll, who is working on the survey, noted that the 1-4% North American gas volume decline and low storage levels this year will keep upward pressure on prices. Driscoll added that full-year 2003 gas production volumes are expected to fall 1-3% in the United States and 2-4% in Canada.

Driscoll surveys 49 North American producers, and 21 have reported results. Although the first quarter U.S. results appear to have topped production results from the fourth quarter, the sequential comparison is versus a level that suffered roughly a 1.4% U.S. production loss because of hurricane-related production shut-ins in the Gulf of Mexico.

According to the Lehman survey to date, the biggest losers production-wise in year-over-year numbers are: Swift Energy, off 36%; Murphy Oil, 29%; ATP Oil & Gas, 22%; Amerada Hess, 20%; Noble Energy, 16%; and El Paso Corp., 15%.

Those surpassing production levels from a year ago include: EnCana Corp., 80% (partially because of a merger); Pioneer Natural Resources Co., up 57%; Westport Resources, up 31%; Spinnaker, up 24%; and XTO Energy and Chesapeake Energy, both up 20%.

Total production for the first quarter is estimated to be 27,249 MMcf/d, compared with 27,833 MMcf/d, according to Driscoll’s figures. Fourth quarter production was 26,794 MMcf/d. Driscoll noted that he had originally forecast production to be up 1.3% sequentially and down 2.1% year-over-year.

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