Cabot Oil & Gas Corp. on Oct. 7 cut its full-year production forecast as the natural gas producer started curtailing some of its output last month after the COVID-19 pandemic hit prices for the fuel.
Demand for natural gas has taken a beating as the pandemic stalled economic activity amid excess supply, with exports of LNG plunging since the start of the year.
Cabot, among the top U.S. gas producers, said it would continue to evaluate opportunities, including temporarily forgoing production in hopes for higher prices later.
"We remain optimistic about the improving natural gas supply and demand outlook heading into 2021," CEO Dan Dinges said.
While prices for gas to be delivered in November were trading around $2.58, prices for the fuel at the start of 2021 were more than $3 on expectations of higher demand.
Cabot said it has curtailed an estimated average daily gross production of about 372 MMcfe/d in the last 13 days of its third quarter, and the cuts have averaged at an estimated 450 MMcfe/d so far in October.
That would hurt full-year production, which it now expects to be between 2.33 Bcfe/d and 2.34 Bcfe/d, lower than its previous estimate of 2.35 Bcfe/d to 2.38 Bcfe/d.
Cabot’s exploration, development and production operations are primarily concentrated in the Marcellus Shale in northeast Pennsylvanian within the Appalachian Basin. Third-quarter production of about 2.41 Bcfe/d was close to the lower end of the 2.4 Bcfe/d to 2.45 Bcfe/d range it had forecast in July.
The company said prices for its natural gas, including hedges, were expected to be $1.57 per thousand cubic feet in the third quarter.
Libya's National Oil Corp. (NOC) said it was lifting force majeure on Sharara oilfield on Oct. 11, and a Libyan source said initial output there will be 40,000 barrels per day (bbl/d), with total production in the country at 355,000 bbl/d on Oct. 12.
Libya's biggest oilfield, El Sharara, will remain shut until an armed group occupying the site leaves, the head of National Oil Corp (NOC) said on Jan. 29, more than a month after the field closed because of a protest.
After four months, production is gradually restarting.