BATON ROUGE – The U.S. Energy Information Administration (EIA) reported today that natural gas production from Louisiana’s Haynesville Shale surpassed production from Texas’ Barnett Shale in February, making the Haynesville the top-producing U.S. natural gas play.
Louisiana Department of Natural Resources (DNR) Secretary Scott Angelle said that the EIA’s announcement serves to underscore the critical role Louisiana continues to play in the energy security and economic health of the nation.
“Louisiana has a long and distinguished history of fueling America. The Haynesville Shale is just the latest chapter in our efforts to build a stronger economy for our nation,” Angelle said. “In Louisiana, we understand that cheap and available energy is absolutely critical to a robust economy.”
According to the EIA report, reported pipeline flows show that the Haynesville Shale is currently producing about 5.5 billion cubic feet a day of natural gas, while the Barnett Shale is producing about 5.25 billion cubic feet.
The Louisiana Office of Conservation has permitted nearly 2,000 Haynesville natural gas wells, of which more than 1,000 have gone into production since the play became commonly known in mid-2008. Of the permitted wells not yet producing, more than 500 have been drilled and are awaiting completion and another 121 are currently being drilled.
Louisiana’s natural gas production surpassed 2 trillion cubic feet in 2010 for the first time since 1982, and represents a 36 percent increase over 2007 – the year before Haynesville production began on a large scale.
The EIA reports that while the Barnett Shale did not reach 5 bcf daily until nearly its 10th year of production – the Haynesville surpassed that mark in less than three years. The EIA notes that improved technology has allowed Haynesville exploration companies to get the same production with fewer wells drilled.
Another factor in the swift growth of the Haynesville is the recent completion of several pipeline capacity expansion projects – allowing Haynesville natural gas to be delivered to market more quickly.
The ongoing development of the Haynesville Shale has positive near-term and long-term impacts both locally and at the national level, Angelle said.
“The development of the Haynesville Shale has meant millions for local and state government as well as helped to create thousands of jobs,” Angelle said.
In property tax valuations alone in the six primary Haynesville Shale parishes – Bienville, Bossier, Caddo, DeSoto, Red River and Sabine – oil and gas related property values were the single largest contributing sector to the increase in overall property tax values, making up 47 percent of total growth in the area from 2007 to 2010.
Total oil and gas related property valuations grew $435 million in that period, compared to the total valuation increase in the six-parish area of $960 million.
“Throughout this nation, robust production of natural gas also helps make our farmers and our manufacturers more competitive in these times of economic challenges,” Angelle said.
Natural gas is the primary feedstock used in production of fertilizer in the agriculture industry, and the most widely used source of energy for manufacturing.
Angelle said that the opportunity represented by the Haynesville Shale and other natural gas plays in the country demands that the nation’s energy policy find ways to encourage wider use of natural gas, including use of compressed natural gas (CNG) as a transportation fuel.
“Nationally, the average price of CNG is more than a dollar less per gallon equivalent than that of gasoline – almost $1.50 less here in Louisiana. Wider use of natural gas to supply our daily transportation needs would amount to giving a pay raise to almost every American by making fuel cheaper at the pump,” Angelle said. “We will continue to urge the nation's policy makers to implement strategies that expand the uses of natural gas. It’s clean, abundant, domestic, and creates American jobs.”