An article in Gulf News on Friday reported that Qatar will now join Russia in cutting back natgas output this year. The country’s two largest LNG producers, RasGas and QatarGas, are expected to idle two thirds or 41 million tons per year (?2.0 Tcf) of Qatar’s export capacity of 61.5 million tons per year (?3.0 Tcf).
Closer to home North American producers are attempting, to little effect thus far, to do the same. Per the latest Baker Hughes report the ratio between gas-to-oil rigs in the U.S. (1.701 as of last Friday) has dropped to four nonconsecutive 13-year lows over the last five reports. Up in Canada the rebound from the spring break up has been tame.
Similar to the situation in the Lower 48, the rigs that have returned in Canada have been geared towards oil. To wit, over the last six weeks oil rigs have increased by 98 while gas rigs are net down 1 rig. As such, over the last four weeks the ratio between gas-to-oil rigs averaged 33.6/66.4. For the corresponding timestep from a year ago the ratio was 43.3/56.7 and for the preceding five years it was 60.7/39.3.