Permian Basin Set to Dethrone Marcellus as US Gas Production Leader
The Permian Basin is poised to become the top US natural gas-producing region by the end of the decade, according to Citigroup analysts. This shift would surpass the Marcellus shale region, which has held the title since 2012.
The Permian's growth will be driven largely by oil production, with gas output being an involuntary byproduct. Unlike the Marcellus, where gas prices are influenced by supply and demand, the economics of production in the Permian are mostly determined by oil prices.
Gas prices in the Permian were negative for four months this year due to a surplus of gas, but new pipelines under construction should alleviate this issue. These projects aim to increase capacity and help meet growing demand from sources such as liquefied natural gas export terminals and power-hungry data centers.