U.S. Natural Gas-Directed Rigs Saw Sharp Decline in 2024

SEATTLE (Oil Monster): According to the most recent report released by the U.S. Energy Information Administration (EIA), the number of rigs in the United States that are directed by natural gas fell by 32% between December 2022 and December 2024.

There were significant drops in the Appalachia and Haynesville regions, which are rich in natural gas. Between 2023 and 2024, the total number of natural gas rigs in these two locations decreased by 34% and 24%, respectively. The record-low natural gas prices for the majority of 2024 are partly to blame for the decline in rig counts.

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Since December 2022, the number of rigs in the Haynesville region—which includes Louisiana and Texas—has decreased by 55%. Higher drilling expenses have made drilling in the area less cost-effective. According to the EIA data, this has led to a 7% decrease in the region's marketed natural gas production during the past two years.

Additionally, since December 2022, the number of rigs in the Appalachia region—which includes the Marcellus and Utica plays—has decreased by 37%. In the meantime, the region's marketed natural gas production increased by 4% over that time.

The benchmark Henry Hub natural gas price in the United States fell by 62% in 2023 and another 16% in 2024 after reaching a 14-year high of $6.95 per million British thermal units (MMBtu) in 2022.