Natural gas plays a key role in almost every Pennsylvanian’s day-to-day life. Every time someone turns on their stove to cook dinner or powers on their dryer to finish the weekly laundry, the natural gas that was drilled from the ground is being put into practical use.
As of 2020, the United States produces nearly all the natural gas that the country consumes. In terms of volume of natural gas produced in each state, Pennsylvania and Texas lead the pack with over 7,000 billion cubic feet of natural gas produced per year. These states are followed by Ohio, West Virginia, Louisiana and Oklahoma with over 4,000 billion cubic feet of natural gas produced per year.
With that said, it is clear that Pennsylvania’s natural gas production has the potential to impact nation-wide natural gas supply with any change or fluctuation that occurs in the market. Therefore, it is surprising to see that, for the second consecutive quarter, Pennsylvania natural gas production has dipped lower than it has in the past five years.
This comes as a contrast when compared to the growth in producing wells, which has picked up significantly since the shutdowns caused by COVID-19 in 2020. The overall cause for the decline in Pennsylvania natural gas production can be attributed to the elevated market prices related to production, global supply and demand pressures, environmental concerns, and nationwide labor shortages that many companies are facing.
Experts predict that, with the increase in wells and the continued economic recovery following the pandemic, Pennsylvania natural gas production will return to a more normalized rate and begin to trend upwards again as the year progresses.
Schneider Downs will continue to monitor the natural gas market. Please contact your Schneider Downs representative with any questions.
About Schneider Downs Energy & Resources Services
The Schneider Downs Energy & Resources industry group provides specialized financial advice and services to our clients in the oil and gas, mining and aggregates, forest products and alternative fuel and energy industries throughout the Columbus and Pittsburgh regions. Our extensive knowledge of industry issues enables us to provide proactive audit, tax and management consulting services.
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