Navigant Releases New Data on North American Natural Gas Market Prices

Navigant Releases New Data on North American Natural Gas Market Prices

Updated outlook for the North American natural gas market, including supply, demand, and prices at key market points.

SACRAMENTO, Calif.--(BUSINESS WIRE)-- Navigant (NYS: NCI) has issued its North American Natural Gas Market Outlook (Outlook), Spring 2013, including updated forecast data on natural gas prices, dry conventional gas and shale gas production, natural gas demand, and gas storage activity.

According to the updated forecast, the real Henry Hub average price will increase at an average rate of 2.9 percent, from $3.66/MMBtu in 2013, to $4.07/MMbtu by 2015, and reach $6.82/MMBtu by 2035.

Navigant's analysis found:

• U.S. natural gas demand will grow from 71.2 Bcfd in 2013 to 89.0 Bcfd by 2035, driven primarily by industrial growth in the near term, and electric generation growth over the longer term.

• The U.S. shale production outlook continues to be strong, growing from 28 Bcfd in 2013 to 56 Bcfd by 2035. In 2035, shale production is expected to represent 61 percent of total U.S. natural gas production.

• LNG exports are expected to grow in the U.S. and Canada, reaching 6.8 Bcfd by 2020.

"High rates of supply growth are still evident in the market, which is somewhat surprising considering the relative flat growth in recent baseload demand," says Gordon Pickering, a director with Navigant's Energy Practice and author of the Outlook. "Given this market, and relatively low prices, we expect a near-term resurgence in demand led by the industrial sector, with additional growth extending for the full term of the forecast."

According to the Outlook, the market will see an increase in industrial consumption of approximately 4.0 Bcfd over the next four to five years, as well as more moderate demand growth in other sectors over the full term of the forecast. In the near term, low natural gas prices will continue to increase coal-to-gas switching in the electric generation sector. In the mid-term, LNG exports will begin to come online as supported by the Department of Energy's recent second approval of a non-Free Trade export application: Order #3282 Granting Long Term Authorization to Export from the Freeport LNG facility on Quintana Island, Texas. Over the long-term, gas demand will primarily be driven by increases in electric generation influenced by stable prices and energy policies that favors natural gas. Overall, the Outlook projects demand increases and steady supply growth that will help to keep prices stable for the duration of the forecast, providing for a healthier and less volatile natural gas market than in years past.

For questions about North American Natural Gas Market Outlook and analysis, please contact: Gordon Pickering at 916.631.3200 or gpickering@navigant.com.

About Navigant

Navigant (NYS: NCI) is a specialized, global expert services firm dedicated to assisting clients in creating and protecting value in the face of critical business risks and opportunities. Through senior level engagement with clients, Navigant professionals combine technical expertise in Disputes and Investigations, Economics, Financial Advisory and Management Consulting, with business pragmatism in the highly regulated Construction, Energy, Financial Services and Healthcare industries to support clients in addressing their most critical business needs. More information about Navigant can be found at www.navigant.com.

* The information contained in this press releasereflects Navigant's current expectations based on market data and trend analysis. Navigant's market predictions and expectations are inherently uncertain and actual results may differ materially from those contained in this press release or the Outlook. Navigant undertakes no obligation to update any of the information contained in this press release or the Outlook.

Navigant
Laverne Murach, 202.481.7336
laverne.murach@navigant.com

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