Dominion South next-day cash prices have gone back down near variable operating costs for major producers like EQT during the month of June 2024. EQT’s variable operating break-even cost for pure dry natural gas production, without the benefit of crude oil or natural gas liquids, is $1.27 / MMBtu.
The $1.27 / MMBtu level at Dominion South cash pricing is right around the point where EQT curtailed approximately 1 Bcf/d of natural gas production in the Southwest Pennsylvania subregion beginning in late February 2024.
The Dominion cash price trading range where EQT curtailed their production and kept it curtailed was between $1.02 and $1.63 per MMBtu. Once cash prices got above $1.70 / MMBtu, EQT brought back their production in late May 2024. The question now is with Dominion South cash prices going back down to shut-in level pricing, does EQT re-curtail their production in June 2024? Southwest Pennsylvania natural gas production bears close daily monitoring. Stay tuned.
Hyperion Frac Update
Natural gas frac crews had a recent growth in late May 2024 with the rally in the NYMEX contract only to see them drop back off in June 2024. Crude oil frac crews continue to be range bound and are currently around the middle of the year-to-date range. Expect both crude oil and natural gas frac crews to go up significantly during the 2nd half of the year based on producer guidance forecasts to investors.