U.S. energy firms target record gas output as LNG and data-center demand grows

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U.S. gas output and demand rise

Highlights

U.S. natural gas production is projected to rise from 107.6 bcfd in 2025 to 112.2 bcfd in 2026 and 116.1 bcfd in 2027, driven by new LNG export capacity and data-center demand.
Expand Energy, EQT, and Range Resources plan to maintain or lower 2026 capex while boosting output, with EQT acquiring Range Resources in a $13 billion all-stock deal expected to close in Q1 2027.
Total U.S. gas demand is forecast to increase from 116.5 bcfd in 2025 to 120.0 bcfd in 2026 as LNG exports surge 17% and domestic supply expands alongside high crude prices.

Production growth plans take shape

As reported by Reuters, U.S. energy companies expect 2026 to deliver a second straight year of record natural gas production as new LNG export capacity and fast-growing electricity needs from data centers lift demand.

The U.S. Energy Information Administration says annual gas production is on track to increase from a record 107.6 billion cubic feet per day in 2025 to 112.2 bcfd in 2026 and 116.1 bcfd in 2027. Matthew Bernstein, vice president of North American oil and gas at Rystad Energy, says most of that growth is coming from associated gas in the Permian and output from the Haynesville.

Three major producers, Expand Energy, EQT and Range Resources, are due to report third-quarter earnings after the market closes on Tuesday. All three have indicated they will spend about the same or less in 2026 than in the prior year while aiming to lift production.

Expand Energy, currently the largest U.S. gas producer, is expected to post third-quarter net income of $304.3 million, according to LSEG estimates, up from adjusted net income of $234.0 million a year earlier. In its second-quarter earnings report in July, the company said it planned to invest about $2.75 billion to $2.95 billion to produce about 7.4 billion to 7.6 billion cubic feet of gas equivalent per day in 2026, versus similar spending in 2025 to produce an average of 7.2 bcfed.

EQT is expected to report net income of $255.4 million for the third quarter, down from adjusted net income of $328.6 million in the same period last year. Earlier this year, the company reduced its 2026 maintenance capital spending guidance by $25 million to $2.04 billion to $2.19 billion, while raising its production outlook by 0.25 bcfed to an average of 6.5 to 6.7 bcfed.

Range Resources is expected to report net income of $188.4 million, up from adjusted net income of $135.2 million a year earlier. On Monday, EQT said it would buy Range in a $13 billion all-stock transaction that is set to create the nation's biggest gas producer, with the companies expecting the deal to close in the first quarter of 2027.

Demand outlook reshapes the U.S. market

Total U.S. gas demand is projected to rise from a record 116.5 bcfd in 2025 to 120.0 bcfd in 2026, according to EIA data. The increase is driven primarily by a 17% jump in LNG exports, while Canadian imports provide additional supply to help meet domestic demand and overseas shipments.

Bernstein says rising Permian gas production is tied to stronger oil output in the basin. U.S. producers are extracting more oil and gas as global fuel markets react to supply disruptions linked to the war in Iran, with an EIA outlook indicating spot U.S. crude prices are on track to reach four-year highs in 2026.

One billion cubic feet of gas is enough to supply about 5 million U.S. homes for a day, underscoring the scale of the expected increase in output and demand. The production plans of the largest shale gas companies now place LNG exports, power demand and basin efficiency at the center of the sector's growth strategy.

In our earlier article on the rapid expansion of U.S. AI data centers, we examined how rising financing costs, construction delays, and power constraints are undermining confidence in many planned projects. We noted that only a minority of announced builds were viewed as realistic, as local opposition and grid limitations increasingly force developers to secure reliable power and keep budgets under control.

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