Natural gas demand in the U.S. is currently growing at the fastest pace since the early 1970s, and is now replacing supply growth as the cornerstone for the outlook over the next five years, according to a new CoBank research report.

The newly issued report entitled "U.S. Natural Gas Outlook through 2020: Demand Is the New Captain of the Ship," points out that the promise of low-cost, reliable natural gas supplies has spurred major investments by all end-users.

As a result, the demand for U.S. natural gas will grow 25% over the next five years, with gas exports accounting for over half the growth.

A portion of the gas exported from the U.S. will be pipelined to Mexico, but most of it will be liquefied and then loaded onto tanker ships destined for overseas markets in Europe and Asia.

The report projects that the U.S. will become a net exporter of natural gas within the next two years, transforming the country into a major supplier to the global energy markets.

"It's definitely a game changer for the global gas markets," said Taylor Gunn, the author of the report, in a statement.

Vast quantities of natural gas have been unleashed since 2008 thanks to advancements in hydraulic fracturing and horizontal drilling. The nation's total dry natural gas production is projected to increase by 29% over the next five years. This parallels the growth in demand.

Even with the large projected growth in the nation's demand and supply of natural gas, natural gas prices are expected to remain little changed from their current low levels—hovering well below $5 per million British thermal units (MMBtu) over the next five years.

The report was produced by CoBank's Knowledge Exchange Division, which is a knowledge-sharing practice that provides strategic insights regarding the key industries served by CoBank. Knowledge Exchange draws upon the internal expertise of CoBank, deep knowledge within the Farm Credit System and boots-on-the-ground intelligence from customers and other stakeholders to enhance the collective understanding of emerging business opportunities and risks.