Sunday, March 30, 2014

Haynesville Shale Natural Gas Production Trends

Most Haynesville area producers have reported production results for January 2014.  The word most is critical here, as it leads to the opposite conclusion that all would.  Rig counts have been very low but stable for a year and a half on both sides of the (TX/LA) border, but production has been trailing off without cease since late 2011.  

With rig and well productivity trending upward in the industry for years now, a naive logical hypothesis would be:
Production will eventually stabilize and perhaps begin a slightly upward trend if rig counts remain stable in the Haynesville.  
But the Haynesville has been a popular whipping boy for so long that it has become axiomatic to illustrate 'terminal decline' of mature and/or uneconomic plays, and the steep decline curve of tight gas.

So.  This is probably going to be wrong.  In 2014.  

Preliminary data show that January 2014 is probably going to be flat with December 2013.  The volumes reported in the first 60 days after a period are a reliable fraction of the final total, and the initial reports from Texas and Louisiana are rather higher than would be typical if gas production declines are anticipated.  These production numbers are going to be steadily revised upwards week after week, as they always have been in the past. (see notes at the bottom of this post). 

The visualizations below show that:

  • LA reports 3.346 BCFD for JAN, vs 3.944 BCFD for DEC
  • TX reports 1.978 BCFD for JAN, vs 2.062 BCFD for DEC

PDF Report by County/Parish


  • Reporting practices and trends for each state differ materially, and until final numbers are in (which can take over a year in TX, but much less is LA) the verdict cannot be pronounced.
  • The data is foggy for other includes all gas production, which includes legacy production, associated gas production, and production from other formations...but those are not very big numbers nor do they tend to vary much from month to month.  The gas rig count, too, can be skewed by rig classification variances, mainly an issue on the Texas side of the border, since few oil rigs are working in LA Haynesville parishes.
  • The production data comes from:  Texas RRC  Louisiana DNR