Natural Gas Drilling Expected To Keep Falling In '08, Oilsands Activity To Grow

Herring's group predicts a huge drop in drilling in 2008. The industry drilled 6,000 fewer wells this year than in did in 2006 and next year it expects to see that figure drop by about another 2,560 - a 38 per cent drop within two years. The Petroleum Services Association of Canada also released dismal predictions for 2008. That group forecasts drilling to go down by 17 per cent between 2007 and 2008. Natural gas prices hit record highs in the fall of 2005, a particularly bad hurricane season for the U.S. Gulf Coast, which hosts a number of major gaswells and gathering pipelines. But since then, North America has experienced two warm winters and one tame hurricane season, leading to a big supply surplus. In addition, the expansion of liquefied natural gas projects has created a global market for LNG, which would freeze and liquefy gas produced in Russia, the Middle East and South America and ship it by tanker to North American markets, where it would be regassified and used to boost supplies to consumers, businesses and power plants. The average price of natural gas in North America was about $6.50 per thousand cubic feet this year. ... http://money.canoe.ca/News/Sectors/Energy/2007/12/31/4747492-cp.html

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