Monday, June 27, 2011

Barnett Shale Production Now Record High: Facts Not Fit To Print In NYT

According to information provided by Tudor, Pickering & Holt, Barnett Shale production is now at record highs of about 5.6 billion cubic feet per day.  The previous peak production was in 2008 at 5.3 billion cubic feet per day.

The current record production of 5.6 billion cubic feet per day has been achieved though the drilling rig count in Barnett has declined by about half.

If wells were producing less than expected and declining faster than predicted, how is the Barnett at record high levels of production?  Remember the drill rig count is down half so the alleged ponzi schemers are not just drilling more holes. 

Sounds like each gas well drilled in Barnett is producing more than was the case--the opposite of a ponzi scheme.

Again the real scandal is the NYT reporter who includes and excludes information in the June 26th and February 27th stories to fit his predetermined sensational and false narrative.


  1. The drill rig count and pace of new well drilling are down, but according to the Texas RR Commission's data, the total number of wells in the Barnett Shale is higher now (14,886 as of 3/7/2011) than in 2008 (10,146). Using those figures and the Tudor Pickering & Holt production figures, the production PER WELL has dropped from about 522K cubic feet per day to about 376K cubic feet per day.

  2. Recently the EIA announced that production in the Haynesville had surpassed that of the Barnett. This is interesting to note because there are ONLY about 1500 wells in the Haynesville and of those about 1200 are producing. There are, however, 14,885 wells in the Barnett according to the Texas Railroad Commission. This means in essence that the average Barnett well is producing 1/10 or less of the average Haynesville well. It is a perfect example of the decline curve realities that the Times exposed in Sunday's article. The Barnett IS a play in severe decline.

  3. For once Mr. Hanger why dont you actually read the story and the documents? You argue that the company and federal emails that The New York Times published are wrong because the total amount of gas being produced in the Barnett is higher than ever. You are off base.

    Barnett totals are higher because each year there are more total wells on line. They are also because companies are
    focusing more on sweet spots.
    What those industry and federal emails were saying has to do with the long term picture (think decades). Will wells decline faster than the industry has admitted? The emails were also asking tough questions about economics. Can companies pull the gas out of the ground affordably?

    Yes, there is more total gas coming from Barnett (and rig count is falling) but how does that answer either of the questions being
    If wells decline, companies can just refrack, right? That will get the well flowing again. Yes, but that costs a lot of money and the question goes back to whether the economics work out. (For more on that see these links, all from the EIA

    So, yes, total production in the U.S. is up. And yes, there is a lot of gas in the ground. But neither of those points answers the questions raised in the industry and federal emails.

  4. Concerned ScientistJune 28, 2011 at 12:31 AM


    Economics are always changing. One issue is the price of gas. Some plays work at $6/mcf but don't work at $4/mcf. As I am sure you know, the price is not fixed. After the gas that works at $4/mcf is produced, companies will wait for the price to go back up to start drilling plays that only work at $6/mcf. What is economic changes over time in other words. It does not mean that there is any less gas in the ground where it currently costs $6/mcf to produce it. Another thing that changes is technology. Drilling and completion technology are constantly improving so plays that might not work at $4/mcf today might work at $4/mcf in two years. Ian Urbina had a great chance to explain how this works to his readers but instead he went for the "they are all lying to us about shale gas" story.

    Again, the people who wrote those emails might not know what they are talking about. We have no idea who they are and if they are in any way qualified to talk about shale gas. For every one of the people quoted in the story there may be 100 who think the opposite. Most of the people I know in the industry are extremely positive about it.

  5. I would hope you recognize the basic premises designated by an enterprise run by rational actors(corporations). It is clearly in the best interests of the free market economy for the natural gas industry in PA to under-report its profits as to discourage the entry of competition and to dissuade the resolve of those who would over regulate the efficient invisible hand of Adam Smith. A study in classical (non-keynesian) economics would benifit your analysis.