Slide 19 of 27

Natural gas wellhead prices are projected to move up 5 percent this winter, averaging about $2.28 per Mcf during this winter compared to the $2.13 per Mcf average seen a year ago.

Winter natural gas wellhead prices will be well below last winter for the fourth quarter but well above last winter during the first quarter, when demand increases are expected to be substantial.

This year’s improved stock level has already had an impact on prices compared to last year. In late September of this year, prices on the NYMEX natural gas commodities futures market for the early months of the upcoming winter season were 20 to 30 percent lower than last year at the same time.

Wellhead prices could range about 8 percent higher or lower if extremely cold or extremely warm weather conditions prevail this winter. The impacts of such deviations on wellhead prices would last well beyond the heating season because of the critical importance of subsequent requirements to replenish gas storage.