While several uncertainties cloud the future of global, national and regional energy markets, the near-term outlook for U.S. and Gulf Coast energy production continues to be strong, according to LSU’s 2020 Gulf Coast Energy Outlook.
Greg Upton, a co-author of the report, said this morning he expects oil production gains to continue. The report predicts the Gulf Coast’s crude oil production to rise to 9 million barrels per day in 2020, 9.6 million barrels per day in 2021 and 10.2 million barrels daily in 2022. That’s up from the 8.4 million predicted last year for 2020.
Upton says advancements in technology can help increase productivity without additional drilling.
“We might enter in a phase with an increase in production with a reduction in drilling,” he says. “It could have huge implications for the labor market.”
Regional natural gas production is predicted to rise to 42 billion cubic feet per day by 2020, a four billion cubic feet increase from last year’s predictions.
Because of global economic uncertainties, GCEO is predicting that some of the recently announced industrial projects will ultimately not be developed. Other projects, specifically larger LNG facilities, while likely be developed along a slower timeline.
From 2019 through 2029, GCEO is predicting that near-term energy manufacturing and export investment will be reduced from its announced $195 billion to $131 billion, with near capital investments through 2023 reduced from $182 billion to $115 billion.
While upstream employment in Texas is expected to drop by some 16,000 jobs, employment in Louisiana is forecasted to stay flat. Employment in refining, chemical manufacturing and energy exports is expected to pick up in both Louisiana and Texas, with some 2,500 new jobs projected for Louisiana through the end of 2022.