Houston Business Journal
Published: 08-11-08
Natural gas production in Texas is up dramatically in 2008 outstripping gains in other states through the first five months of the year according to an investment bank analysts’ report.
The report notes that newly developed natural gas plays using unconventional drilling techniques such as the Barnett Shale and Haynesville Shale hold ample reserves to spur growth rates in total U.S. production.
“Questions may be posed at how fast that production can get to market based on existing and expanding infrastructure which may guide the pace of development in the near term” the report noted.
According to SNL Financial Texas production increased by 2440 million cubic feet per day over the same period a year ago Barclays Capital analysts George Hopley and Michael Zenker said in an Aug. 5 report.
Combined gains in Wyoming Oklahoma Louisiana and other producing states saw average production increases of 1920 MMcf/d during the period.
Overall U.S. gas production averaged 55057 MMcf/d in 2007 up 1957 MMcf/d from 2006. Overall production in 2006 averaged 53100 MMcf/d up 1260 MMcf/d from 2005.
“Historically such large gains in consecutive years have rarely been followed by a third year of strong growth so from an annual perspective the idea that production growth would plateau had some precedent” the analysts said.
“However the steep gains achieved in marketed production even in the final months of (2007) should have shown that the growth trend had momentum to carry over into this year.”
In the long term the analysts said decline rates will take on importance but those concerns will be shelved as new fields begin producing.
