The suits at BP describe the Haynesville shale as “the most revenue generating gas play in the U.S.” Since its discovery in 2008 by Okla. City-based Chesapeake, this gas-rich play has been estimated to hold more than 304+ TCF of recoverable natural gas. The future looked bright back then, and the big dog independents and supermajors soon came hunting to sniff out a bone of their own. By 2010, the Haynesville boasted more drilling rigs than any other play in the country.
But as the story goes in the world of oil and gas, nothing stays the same for long. Depressed gas prices followed with a monumental glut of supplies from across the nation as though we’d opened a Pandora’s Box. The U.S. was christened the world’s leading producer of natural gas, but what to do with it all? Then, quite amazingly, out of the ashes of oversupply, the LNG export industry was born. The rest, as they say, is history.
But back to the Haynesville. Over the last few years of industry consolidation and power shifts, the Haynesville has witnessed a resurgence of natural gas drilling with production bound for Gulf Coast LNG export. Independents like Comstock are snapping up acreage positions like a hungry bayou gator, with the expressed intention to flow that gas directly to Gulf export terminals only 200 miles away.
Midstream companies, too, are zeroing in on the Haynesville action. Houston-based Enterprise plans to expand its Haynesville gas pipeline to deliver 2.1 BCFD to the Gulf. Okla. City-based Enable looks to build the 135-mile Gulf Run Pipeline. Michigan-based DTE Midstream last month paid $2.25 billion for a natural gas gathering system in the Haynesville with plans to build a 150-mile pipeline connecting to multiple downstream pipelines that terminate at the Gulf. And most recently this month, Texas-based Align Midstream and Elevate Midstream combined their Haynesville assets with all eyes on LNG exports.
Looks like things are heating back up in the South. What do you think?