HOUSTON Feb 6 Chesapeake Energy Corp,
the No. 2 natural gas producer in the United States, said on
Thursday that unusually cold weather across much of the country
was hurting its output.
The comments from Chesapeake Chief Executive Doug Lawler
came as spot prices for natural gas, widely used to fuel power
plants, spiked to the highest levels since 2008.
Freezing temperatures across the country this winter have
pushed demand to all-time highs and filled the pipeline system
to capacity, while at the same time prompting a number of
companies to say foul weather was snarling production.
Estimated U.S. natural gas output is running about 0.8
billion cubic feet per day (bfcd) lower than the 30-day moving
average and is off 1.5 bcfd from the start of this year when
temperatures were more moderate, according to Thomson Reuters
Analytics - which sees current U.S. pure dry gas production of
Chesapeake's average daily oil and gas output in December
was well below its expectations due to "weather challenges" that
continued into January and February, Lawler told analysts on a
conference call on Thursday.
Fourth-quarter and first-quarter production will be affected
by the icy conditions that hampered some of the company's
operations, but output should "ramp up" on a sequential basis in
the second quarter, Lawler said.
On Tuesday, Chuck Meloy, an executive at Anadarko Petroleum
Corp, said on a conference call the company's operations
in Colorado were finally returning to normal.
"The Wattenberg field has suffered through the floods and
the polar vortex and I'm sure the locusts are coming," he joked.
"But ... our production is coming back."
Gas for Friday delivery at Henry Hub, the benchmark supply
point in Louisiana, traded as high as $9 per million British
thermal units early Thursday, its highest since August 2008,
Futures prices were up more than 1 percent on
Thursday after rising more than 7 percent earlier in the day.
They pared gains when U.S. Energy Information Agency data
showed an estimated natural gas draw through Jan. 31 of 262
billion cubic feet, lower than the 270 bcf forecasted by