Haynesville Shale https://www.fool.com/investi
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Posted On: 12/20/2017 6:43:44 PM
Haynesville Shale
https://www.fool.com/investing/2016/09/01/the...ale-p.aspx
The Haynesville might not be the hot shale play it once was. Slumping gas prices took the wind out of its sails, while oil discoveries in the Eagle Ford and more economical gas discoveries in the Marcellus and Utica put it on the back burner. However, it is the third-largest shale gas producer in the country, making it one of the top shale plays. Furthermore, improving drilling returns and rising natural gas demand from liquefied natural gas (LNG) export facilities have the potential to revive this dormant drilling region.
The Haynesville shale 101
The Haynesville shale encompasses over 9,000 square miles of eastern Texas and western Louisiana
The play was initially discovered by Chesapeake Energy (NYSE:CHK) in 2008, leading its rivals to descend upon the area to lease land. That said, while the Haynesville was the draw, there are several producing formations in the region, including the Bossier and Terryville. However, while natural gas saturates these rock formations, drilling activity died down due to the oil market downturn.
In the future, activity could revive thanks to the Haynesville's proximity to several LNG export terminals that are under construction along the Gulf Coast. Cheniere Energy, for example, is just starting to ramp up its Sabine Pass facility in Lousiana. In July, Cheniere Energy commissioned the second export train at that facility, and it has several additional trains under development at Sabine Pass and its Corpus Christi location in Texas. Meanwhile, several other LNG export facilities are currently under development. Once complete, these facilities could drive incremental natural gas demand from the Haynesville.
That bodes well for the play's dominant producers and acreage holders, which are poised to cash in on that future. In fact, according to projections, between 35,000 to 50,000 future wells could be drilled in the play.
https://www.fool.com/investing/2016/09/01/the...ale-p.aspx
The Haynesville might not be the hot shale play it once was. Slumping gas prices took the wind out of its sails, while oil discoveries in the Eagle Ford and more economical gas discoveries in the Marcellus and Utica put it on the back burner. However, it is the third-largest shale gas producer in the country, making it one of the top shale plays. Furthermore, improving drilling returns and rising natural gas demand from liquefied natural gas (LNG) export facilities have the potential to revive this dormant drilling region.
The Haynesville shale 101
The Haynesville shale encompasses over 9,000 square miles of eastern Texas and western Louisiana
The play was initially discovered by Chesapeake Energy (NYSE:CHK) in 2008, leading its rivals to descend upon the area to lease land. That said, while the Haynesville was the draw, there are several producing formations in the region, including the Bossier and Terryville. However, while natural gas saturates these rock formations, drilling activity died down due to the oil market downturn.
In the future, activity could revive thanks to the Haynesville's proximity to several LNG export terminals that are under construction along the Gulf Coast. Cheniere Energy, for example, is just starting to ramp up its Sabine Pass facility in Lousiana. In July, Cheniere Energy commissioned the second export train at that facility, and it has several additional trains under development at Sabine Pass and its Corpus Christi location in Texas. Meanwhile, several other LNG export facilities are currently under development. Once complete, these facilities could drive incremental natural gas demand from the Haynesville.
That bodes well for the play's dominant producers and acreage holders, which are poised to cash in on that future. In fact, according to projections, between 35,000 to 50,000 future wells could be drilled in the play.
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