Hope and change are two words seldom associated with natural gas these days, other than that many privately held independents-- and not a few public companies--hope the oversupplied natural gas situation changes soon.

Positive change would do wonders for gas-weighted portfolios, even as public operators scramble to rebalance holdings to encompass a greater percentage of revenues from liquids. The consensus is that natural gas is going to remain a contrarian play for oil and gas operators for some time to come. It’s a commodity that features a never-ending stream of eulogies from the industry’s best and brightest.

Just look at recent headlines: “2015: Most Challenging Year for the Natural Gas Market Since 2012?” asked Houston-based Simmons & Co. International.

“U.S. gas supply is poised to meaningfully outpace demand over the next few years,” writes Marshall Adkins, an oil services analyst at Raymond James & Associates Inc. And Bernstein Research’s Bob Brackett sees the growing supply of associated gas as a reason to de-rate price targets for gas-heavy companies. “We have more deeply evaluated the growth in U.S. gas supply, especially in terms of its role as an associated product, and come away with a more pessimistic view,” Brackett writes.

The gas situation would be worse yet if the midstream build out in Appalachia could keep pace with new development. Appalachia is the major source for growing domestic gas supply and, with 20 billion cubic feet per day (Bcf/d) in sight, might join Texas as the nation’s largest gas-producing region in the next half decade. Even reversing the flow of gas pipelines out of Appalachia only promises to export the region’s low prices to other areas of the country.

Certainly the public companies have gotten the message. Witness this year’s significant divestments of gas properties in the Haynesville, Canada’s Deep Basin, Jonah Pinedale, and the Hugoton from Royal Dutch Shell, Encana Corp., and Pioneer Natural Resources Co., among others. Divestitures are driven by the need to raise capital to finance the drill out of tight oil holdings, or to alleviate debt-heavy balance sheets from outspending cash flow on expensive unconventional projects. Two-thirds of the shale gas joint ventures that electrified the industry a half decade ago have not been as economic as hoped.

But some divestitures represent plain old-fashioned capitulation. Apparently increased natural gas deal flow in 2014 suggests some operators are happy to exit at current prices.

Then again, someone is on the other side of those deals and obviously ready to buy. More often than not, it is private-equity-backed firms and the upstream MLPs. So what do buyers know that the rest of the industry doesn’t? The implied price for proved reserves in natural gas transactions is up slightly over the last year, but not measurably out of line with the post-2009 average of $1.62 per Mcf, according to Ken Olive, CEO for the Oil and Gas Asset Clearinghouse. Olive spoke in September at Hart Energy’s A&D Strategies Conference in Dallas.

Secondly, the Nymex futures market shows pricing for natural gas rising steadily after 2015 toward $4.60 by 2020, even as oil prices deflate toward $87. Nymex futures are seldom accurate in predicting the future but rather reflect current sentiment.

Not much will happen on the supply front. Instead, gas advocates--and there are some, such as EnerVest Ltd.'s CEO John Walker--point to greater-than-anticipated demand and unexpected wild cards. While record production this summer has gas storage in line to meet winter demand, the industry is entering the heating season with a gas inventory somewhere around 3.5 Tcf, the lowest level since 2005. Another cold winter could shave a year off the wait for gas recovery.

Components of demand on tap over the next half decade include U.S. EPA mercury and air toxics standards, which could retire 24% of U.S. coal-fired power generation capacity, leading to a natural gas demand increase of more than 5 Bcf/d after 2015. Additionally, gas advocates identify more than 400 industrial projects that will use natural gas over the next half decade, representing more than 6 Bcf/d in additional demand.

South of the border, the rapid pace of energy reform in Mexico continues to surprise observers. Planned pipeline expansions and power generation projects could add more than 7 Bcf/d in natural gas exports. Finally, momentum is underway on the great LNG buildout, which could export more than 6 Bcf/d by 2022.

Hope indeed for natural gas.

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