P

ORTER, Commissioner Gas Services Division

B

UDDY GARCIA, Commissioner Market Oversight Section

October 22, 2012

Na t u r a l Ga s Tr e n d s

Highlights Data

AGA’s Promise of Natural Gas

According to the American Gas Association (AGA) we

are seeing a fundamental shift in the national gas marketplace.

AGA opines that the production of natural gas from shale and

other unconventional

resources has added

greatly to North

American supplies in

recent years. AGA

believes that the

country’s bullish

natural gas supply

outlook offers an

incredible opportunity

to deliver energy value

to American homes and

businesses, fuel a

renaissance in U.S. manufacturing, and provide a cleaner less

expensive option for vehicles, thus reducing our dependence on

imported oil.

AGA sees stable natural gas prices for the next decade.

For the next decade and beyond, domestic natural gas supplies

are expected to be sufficiently robust to meet growth in demand

across all sectors. Advances in American technology have

opened the door to efficient, affordable, and responsible

extraction of natural gas in North America.

AGA contemplates a future of market stability:

·

The natural gas market is characterized by robust

supply and significant potential for expanding its use in

homes, businesses, power generation, industrial plants,

and vehicles as well as the export of LNG;

·

There is room to grow natural gas demand at reasonable

and relatively stable prices;

·

Over the next decade a range of demand scenarios can

be met by a diverse and responsive supply market

within an estimated price band of $4.00 to $6.50 per

MMbtu, a level well below the peak market prices of

the preceding decade;

·

Even significant increases in demand can be supported

by this large, dynamic, robust and diverse North

American natural gas resource base;

·

When coupled with expanding infrastructure and

appropriate regulatory constructs we envision relative

natural gas market stability during the next ten years