Bottomed

U.S. drilling activity has bottomed out and will begin to expand “very slowly” in 2010, the CEO of Baker Hughes Inc. (BHI) said Wednesday.

As one energy prognosticator sees it, natural gas production across the entire United States has “clearly” bottomed out and is once again ramping up, driven by two things: a slowdown in shallow field declines in the Gulf of Mexico (GOM) and growth in several key unconventional resource plays.

As one energy prognosticator sees it, natural gas production across the entire United States has “clearly” bottomed out and is once again ramping up, driven by two things: a slowdown in shallow field declines in the Gulf of Mexico (GOM) and growth in several key unconventional resource plays.

Looking almost like a carbon copy of price action on Tuesday, December natural gas on Wednesday bottomed out at $11.510 and peaked at $11.930, before settling at $11.669, down 12.4 cents on the day.

As natural gas prices soared last winter, significant switching from natural gas to residual fuel and heating oil made the “linkage” between the commodities all too clear, according to Raymond James & Associates’ John Gerdes in an energy brief released last week. Although natural gas is considered the fuel of choice to supply the nation’s growing power needs, the last five months of 2000 showed that price can change everything.

As natural gas prices soared last winter, significant switching from natural gas to residual fuel and heating oil made the “linkage” between the commodities all too clear, according to Raymond James & Associates’ John Gerdes in an energy brief released Monday. Although natural gas is considered the fuel of choice to supply the nation’s growing power needs, the last five months of 2000 showed that price can change everything.