Production Rises in Barnett, Haynesville Shales Even as Rig Counts Fall

Tuesday, October 11, 2011

When US natural gas prices are obstinately hovering around a relatively low $3.50/Mcf and yet you have a lot of acreage in major gas fields, what do you do? Logic would tell you to cut back. Yet production has been rising in two of the country's biggest gas fields.

In the gas shale plays of the Barnett in North Texas and the Haynesville in East Texas and Lousiana, production continues to climb even as rig counts have dropped.

Yet in that same 12-month period, gas production in the Barnett rose from 5.4 Bcf/d to 5.7 Bcf/d, according to figures supplied by Bentek Energy, a unit of Platts. That compares to 4.75 Bcf/d at the start of October 2009. And from early October 2010 to early October 2011, oil production along the Barnett's northern edge grew from 75,464 b/d to 88,902 b/d, Bentek said.

Further east in the Haynesville Shale, a peak of 181 rigs were working at the start of July 2010. At the same time a year later, that figure had fallen to 126 rigs. Last week, the count was 110 rigs--surprisingly high given gas prices that during that time have stubbornly hovered in the $3-$4/Mcf range.

In July 2010, Haynesville production was 4.65 Bcf/d, yet by early October 2011, volumes had jumped to 7.58 Bcf/d, Bentek estimates show. Haynesville gas is "dry," meaning largely liquids-free.

To access a complete copy of this report, please visit