For the first time since December 2009, total natural gas production in the Barnett Shale is below 5 billion cubic feet a day, reports Powell Shale Digest. The online newsletter cited Texas Railroad Commission monthly reports that include wells in the agency's pending file, which can account for significant production. According to Powell, production in June averaged 4.84 bcf daily. That's down 16.5 percent from a year earlier and down 20.8 percent from two years earlier. Barnett production peaked in November 2011 at 6.33 bcf a day.
Gene Powell, publisher of the Shale Digest, said in an interview that he expects production to fluctuate above and below 5 bcf a day as late production reports come in, and to settle in a range of 4.5 billion to 5 billion cubic feet a day in the coming year. Of the overall decline trend, Powell said production has held up better than he expected, given the sharp fall-off in drilling since gas prices collapsed starting in late 2008. With few exceptions, there have been fewer than 30 drilling rigs working in the big North Texas field, the lowest activity in more than a decade, according to RigData's weekly report.
Natural gas prices would have to reach about $5.50 per 1,000 cubic feet and stay there a few months for producers to resume drilling at a rate that could push production back above 5 billion cubic feet a day, Powell said.
-- Jim Fuquay