EQT plans to reverse some US natgas production curtailments in Oct, CEO says
Sept 25 (Reuters) - U.S. energy company EQT plans to reverse some natural gas production curtailments in October and November as demand for the fuel and prices increase, CEO Toby Rice told Reuters on Wednesday.
EQT, the biggest U.S. gas producer, has along with other U.S. drillers curtailed output in 2024 after prices collapsed to multi-year lows in the spring following a mild winter that left a tremendous oversupply of fuel in storage.
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"Production curtailments will be a normal part of our strategy when prices are low," Rice said, noting the company has already curtailed about 1 billion cubic feet per day (bcfd) of production in the spring.
"We're watching to see that come back in October and November ... We will ease curtailments in October," Rice said, noting total curtailments were around 2 bcfd across the entire industry.
Analysts have said they expect EQT and other producers to boost output in late 2024 and in 2025 to meet growing export demand as new U.S. liquefied natural gas (LNG) plants enter service.
Rice, in New York during Climate Week, made his comments after the Partnership to Address Global Emissions, an advocacy group of which EQT is a founding member, launched a new study, “Securing Europe’s Net Zero Path with Flexible LNG,” in collaboration with the Centre on Regulation in Europe.
In addition to being the world's biggest producer and consumer of gas, the U.S. is also the world's biggest supplier of LNG and its capacity to produce the super-cooled fuel will almost double over the next five years.
The seven big LNG export plants currently operating in the U.S. can turn about 13.8 bcfd of gas into LNG for export. That will jump to around 17.8 bcfd in 2025, 19.8 bcfd in 2026, 22.3 bcfd in 2027 and 24.5 bcfd in 2028 as new plants already under construction enter service.
One billion cubic feet of gas can supply about five million U.S. homes for a day.
Rice said EQT produces roughly 6 bcfd of gas and sends about 25% of its volumes to the Gulf Coast, providing access to LNG export plants operating in Texas and Louisiana.
In addition, EQT has agreements for liquefaction services with two LNG export plants under development, Texas LNG and Commonwealth LNG.
Rice said those agreements will enable the company to sell LNG directly to customers. He noted EQT was "beginning to ramp up conversations about long-term supply agreements" with potential customers.
Rice said Texas LNG should reach a final investment decision (FID) in 2025 and hopefully send out first cargoes by 2028 or 2029.
(Reporting by Scott DiSavinoEditing by Bill Berkrot and David Gregorio)