Louisianas two major oil and gas plays offer study in contrasts – Greater Baton Rouge Business Report

Louisianas two predominant oil and gas plays, Tuscaloosa Marine Shale and Haynesville Shale, have taken starkly divergent paths over the past decade. While poor market conditions have made the TMS too risky for most drillers, Haynesville rig counts are on the rise due to burgeoning liquefied natural gas exports.

Patrick Courreges, communications director at the Louisiana Department of Natural Resources, says recent DNR data tells the tale. Theres currently only one active drilling permit in the TMS and dozens in the Haynesville play. Were seeing about 30-odd rigs split between Haynesville Shale and the Cotton Valley formation, he says. That has been fairly steady.

The shale play boom began with little fanfare about a decade ago. For the first time, advances in horizontal drilling and hydraulic fracturing enabled oil producers to access what had before been commercially unavailable. The relatively high oil and natural gas prices at the time provided the incentive for experimentation and risk-taking, and U.S. production began to surge.

The massive TMS, which covers 8 million acres in Louisiana and Mississippi, has long tantalized oil companies and economic development officials, but idiosyncratic extraction challenges and the 2014 price plunge have kept it from realizing its economic potential.

Meanwhile, theres an entirely different reality underway in northwest Louisiana. Haynesville Shale has hitched its wagon to the growing LNG export business and the dry gas it offers has made it very attractive.

You just dont get dry holes (in Haynesville), Courreges says. They know how to drill it, know how to fracture it, and how to get the best out of it. Louisiana is now at 3 trillion feet a year in gas production, with the bulk of that coming from Haynesville. Read the full story from the latest edition of Business Report here.

More:

Louisianas two major oil and gas plays offer study in contrasts - Greater Baton Rouge Business Report