According to the U.S. Energy Information Administration (EIA) website article published on May 3, 2023, Dry natural gas production from the Haynesville shale play in northeastern Texas and northwestern Louisiana reached new highs in March 2023, averaging 14.5 billion cubic feet per day (Bcf/d), 10% more than the 2022 annual average of 13.1 Bcf/d, according to data from Enverus. Haynesville natural gas production currently accounts for about 14% of all U.S. dry natural gas production.
The Haynesville is the third-largest shale gas-producing play in the United States, behind the Marcellus play in the Appalachian Basin and the Permian play in Texas and New Mexico. In 2022, dry natural gas production averaged 25.2 Bcf/d from the Marcellus play (83% of Appalachian Basin production) and 15.4 Bcf/d from the Permian play. The Marcellus, the Permian, and the Haynesville plays combined account for 55% of U.S. dry natural gas production.
Natural gas production in the Haynesville increased in 2022, from an average 12.4 Bcf/d in January to 13.9 Bcf/d in December. Natural gas prices rose relatively steadily through the summer of 2022 as well. The U.S. benchmark Henry Hub, after reaching a monthly high for the year in August at $8.81 per million British thermal units (MMBtu), declined to average $5.53/MMBtu in December—still 26% higher than at the start of the year. Drilling costs in the Haynesville tend to be higher because natural gas wells in the play are deeper than in other plays. As natural gas prices rose in 2022, economics for developing new wells in the Haynesville improved, which led some producers to add more rigs in the play and increase production.
The rise in active natural gas-directed rigs in the Haynesville in 2022, as reported by Baker Hughes, followed rising natural gas prices. In the Haynesville, an average of 65 rigs were in operation in 2022, a 43% increase compared with 2021. In the first three months of 2023, as natural gas prices fell, the number of active rigs in the Haynesville plateaued at about 68 rigs.
Pipeline takeaway capacity out of the Haynesville is currently estimated to be around 16 Bcf/d, according to S&P Global Commodity Insights. The Enterprise Products Partners’ Gillis Lateral pipeline and the associated expansion of the Acadian Haynesville Extension, which both move natural gas from the Haynesville to demand centers and liquefied natural gas terminals along the U.S. Gulf Coast, were the most recent pipeline projects to enter service (December 2021) in the region.
In addition, three new pipeline projects, if completed on time, will add 5.0 Bcf/d of takeaway capacity out of the Haynesville by the end of 2024:
- Williams’ Louisiana Energy Gateway (1.8 Bcf/d)
- Momentum Midstream’s New Generation Gas Gathering (NG3) (1.7 Bcf/d)
- TC Energy’s Gillis Access project (1.5 Bcf/d)
