How are the surging natural gas prices affecting drilling this year, and what about going into 2022?  Are the gas companies taking advantage of these higher prices?  What`s next?

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Ralph, stagnant may be inappropriate as a description.  I mean a gas company who isn`t being too aggressive towards further development and certainly one whose stock pricing record is "stagnant"  Up a little & then down a little with a record of minimal growth & losses.. IMHO   Private companies are in a whole different category.

CNX could be  the most stagnant ....... Heavily hedged for a few years  forward ... Market yawns when CNX is mentioned ... Good Financial metrics but Investors are not inspired ...... NFG at this point is also a contender ... Decent outfit but little MOJO 

What would need to change for CNX to become a more inspiring gas company to investors?  Maybe a new CEO or maybe more public information about their development plans?  NFG seems to be have their plans in place and are moving forward pretty steadily.  Their Fee acreage is a huge benefit for them.

NFG is a fine but uninspiring outfit for most energy Investors ....NFG Utica could be called tier 2 ,,, NFG Fee Lands helps that tier 2 land somewhat competitive .. NFG legacy pipeline systems also help keep costs lower ....

 CNX will either be sold or needs to greatly increase its dividend... COG was in a similar position and had no way out except a merger ..

 What makes CNX 'boring' may soften the downside when the DOW tanks somewhere in the future ........But when the Avalanche of sell orders hit the DOW , nothing seems really safe ....

And all the producers have been trying to get out of their hedges to take advantage of the high prices.  I assume that was a short-term move on their part because everything I've read over the last month or so about natgas prices has said that the expected price next spring is going to be around $3.00/MMBtu.

How would $3 meet their needs?  Is it enough to stimulate more drilling?  Aren`t some hedges now above $3? 

EQT , CNX have hedges that do not inspire for 2022 ...At last report CHK was 50% hedged , AR about the same ...... 

Yes, they will make a profit at $3.  I don't have a cite for it, but I've read a number of articles over the years that showed that most natgas producers will survive through $2, and do well as they get closer to $3.  It's not enough to stimulate more drilling, but frankly, until takeaway capacity is increased in the Marcellus/Utica region, we won't see a significant increase in drilling activity.

Most need in the lower $2 range to breakeven .... Takeaway is no longer much of an issue in the SW PA region , but continues to plague the NE PA region .........  

Forward curve for 2022 is roughly in the $3.80 range , pretty darn good ........ 

 Costly to get out of current hedges , most do not , they write off the loss , in reality its a paper loss ......

$3.80 is a very reasonable price for most of them.  If I were a producer, I'd be happy with projections like that.  Agreed about the hedges.

I am starting to think Seneca is paying royalty owners there hedge price not current market price.  


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