The natural gas market has seen drastic changes over the past year. The biggest impact of 2020 has been a remarkable decline in drilling in most key basins. This drop is associated with, but not exclusively a result of, the COVID-19 pandemic. The COVID-19 pandemic has had far reaching effects on both natural gas production and demand, both in abrupt, short-term shocks and changes to longer-term growth prospects. Midstream development has all but temporarily halted in this crisis. Natural gas demand, which was supposed to undergo steady growth in the year of 2020, has instead contracted slightly in the face of this unprecedented obstacle. 

This document and associated presentation describe the price and basis implications of these changes for the five-year period from the start of 2021 until the end of 2025. Basis points examined include Katy Hub, Tennessee 500-Leg, Tx Eastern ELA, Columbia Gulf Mainline, Texas Gas Zone 1, Carthage Hub, NGPL Texok, Southern Star, CIG Rockies, and Waha Hub. Analysis of such locations provides a forecast of the basis differential to Henry Hub, offering insight into the market and identifying potential hedging opportunities.