Haynesville Shale: Record Natural Gas Production

Guest “Fracking A, Bubba,” by David Middleton

The Haynesville Shale (technically Haynesville/Bossier) in northeast Texas and northwest Louisiana is the third largest natural gas play, in terms of production rate and proved reserves, in these United States. Haynesville gas production set a record high in 2021 and will likely break that record this month.

Source: U.S. Energy Information Administration, Dry shale gas production estimates by play

APRIL 13, 2022
Haynesville natural gas production reached a record high in late 2021

Dry natural gas production from the Haynesville shale play in northeastern Texas and northwestern Louisiana reached new highs in the second half of 2021, and production has remained relatively strong in early 2022. Haynesville natural gas production accounted for about 13% of all U.S. dry natural gas production in February 2022.

Haynesville is the third-largest shale gas-producing play in the United States. The Marcellus play in the Appalachian Basin (mainly in Pennsylvania, West Virginia, and Ohio) is the highest-producing shale gas play in the United States. During 2021, an average of 31.7 billion cubic feet per day (Bcf/d) of natural gas was produced from the Marcellus play. In the Permian play in Texas and New Mexico, production averaged 12.4 Bcf/d in 2021, making it the second-highest producing play. Altogether, the Marcellus, the Permian, and the Haynesville account for 52% of U.S. dry natural gas production.

Natural gas production in the Haynesville declined steadily from mid-2012 until 2016 due to its relatively higher cost to produce natural gas compared with other producing areas. At depths of 10,500 feet to 13,500 feet, wells in the Haynesville are deeper than in other plays, and drilling costs tend to be higher. By comparison, wells in the Marcellus in the Appalachian Basin are shallower—between 4,000 feet and 8,500 feet. Years of relatively low natural gas prices meant it was less economical to drill deeper wells. However, because natural gas prices have increased since mid-2020, producers have an incentive to increase the number of rigs in operation and use those rigs to drill deeper wells.

Producers tend to increase or decrease the number of drilling rigs in operation as natural gas prices fluctuate. The number of natural gas-directed rigs in the Haynesville has been rising steadily since the second half of 2020 and reached an average of 46 rigs in 2021, according to data from Baker Hughes. Since the beginning of 2022, producers have added 17 rigs in the Haynesville region. For the week ending April 8, there were 64 natural gas-directed rigs operating in the Haynesville, representing 45% of natural gas-directed rigs currently operating in the United States.

Pipeline takeaway capacity out of the Haynesville has also increased in recent years. The additional capacity allows producers to reach industrial demand centers and liquefied natural gas terminals on the U.S. Gulf Coast. The Enterprise Products Partners’ Gillis Lateral pipeline and the associated expansion of the Acadian Haynesville Extension entered into service in December 2021. Prior to that project, Enbridge Midcoast Energy’s CJ Express pipeline entered into service in April 2021. These projects added 1.3 Bcf/d of takeaway capacity in the Haynesville area, which is currently estimated to total 15.9 Bcf/d according to PointLogic.

Principal contributor: Katy Fleury

Tags: production/supply, natural gas, shale, Haynesville

EIA

Haynesville Features

Favorable Regulatory Environment

Haynesville pipeline takeaway expansion has not faced the same sort of political opposition as has plagued the Marcellus Shale. Texas has a very favorable regulatory environment, so favorable that only 33% of Texas Democrats support a ban on frac’ing.

No Flaring Required

Being a nearly pure gas play, flaring is almost nonexistent in the Haynesville play.

2020 gas flaring map (Phys.org). The most extensive flaring occurs in oil plays where low gas prices and/or lack of pipeline takeaway capacity make it more economical to flare associated natural gas, rather than try to market it. The bright yellow blobs are: Permian Basin in West Texas, Eagle Ford play in Southeast Texas and the Bakken play in North Dakota.

Proved Reserves

At year-end 2020, the estimated proved gas reserves in the Haynesville stood at 44.8 trillion cubic feet (Tcf). If the Haynesville was a nation in Europe, it would rank second only to Norway (50.5 Tcf).

Note: the 1.9 Tcf decline in proved reserves from 2019-2020 is not due to there being less natural gas than previously thought. It’s due to low natural gas prices in 2020 (shamdemic effect). US oil and natural gas proved reserves declined in 2020. The decline was entirely due to price-driven revisions. Extensions and discoveries actually exceeded production by 2.7 Tcf.

U.S. Crude Oil and Natural Gas Proved Reserves, Year-end 2020 (EIA)

Most increases in proved reserves are the result of field extensions, rather than new discoveries.

Discoveries include new fields, new reservoirs in previously discovered fields, and additional reserves that resulted from drilling and exploration in previously discovered reservoirs (extensions). Extensions typically make up the largest share of total discoveries. Beginning with the 2016 report, operators reported to us on Form EIA-23L their discoveries as a single, combined category—extensions and discoveries. Totals for that category are presented in one column on the data tables in this report.

U.S. Crude Oil and Natural Gas Proved Reserves, Year-end 2020 (EIA)

Extensions typically represent the conversion of probable reserves, possible reserves and contingent resources into proved reserves, based on well performance, infield drilling and other asset management efforts. Proved reserves only represent the volume of oil and/or gas with a >90% probability of being recovered.

Undiscovered Resource Potential

The most recent USGS assessment puts the undiscovered resource potential of the Haynesville shale (highlighted) at nearly 300 Tcf (~10 years of total US natural gas consumption).

Assessment of Undiscovered Oil and Gas Resources in the
Haynesville Formation, U.S. Gulf Coast, 2016. (USGS)

The Haynesville shale plays are the hachured and dotted areas on the map below…

Assessment of Undiscovered Oil and Gas Resources in the
Haynesville Formation, U.S. Gulf Coast, 2016. (USGS)

The Many Benefits of Catastrophic Sea Level Rise

The Haynesville Shale, which has also been referred to as the “lower Bossier,” is the basinal equivalent
of the Cotton Valley Lime and pinnacle reef trend in East Texas that was deposited during the transgressive phase of SS2. These pinnacle reefs formed in response to the rising sea level as they were back-stepping onto Haynesville ramp carbonates; the carbonates were able to keep up with rising sea level until they were “drowned” by the fine-grained-sediment-dominated transgression. The top of the Haynesville Shale marks the maximum flooding surface as evidenced by maximum marine onlap on the shelf (e.g., Goldhammer, 1998). The Bossier shales (so-called “upper Bossier”) are characteristic of the highstand systems tract of SS2 reflecting a turn-around in sea level and increase in siliciclastic influence.

Hammes et al., 2009

A marine transgression (catastrophic sea level rise), approximately 150 million years ago, led to the deposition of the Haynesville Shale, as well as the trapping mechanism for the Haynesville Shale and the stratigraphically equivalent Cotton Valley Lime pinnacle reef plays.

Haynesville stratigraphic column. Ramirez et al., 2011, Galloway, 2008
Isopach (thickness) map of the Haynesville/Bossier Shale. Ramirez et al., 2011

The hydrocarbons in the Haynesville Shale and Cotton Valley Lime were sourced from the Smackover and Haynesville Formations.

Mudstones within the Upper Jurassic Smackover and Haynesville Formations are sources of oil and gas
in both conventional (Montgomery, 1993a, 1993b; Mancini and others, 2006) and continuous reservoirs
(Hammes and others, 2011; Cicero and Steinhoff, 2013) throughout much of the assessment area.

Assessment of Undiscovered Oil and Gas Resources in the Haynesville Formation, U.S. Gulf Coast, 2016. (USGS)

The Smackover Formation is probably the most prolific source rock in the Gulf Coast/Gulf of Mexico region. Depending on depositional environment, the Smackover is also a prolific oil & gas producer and the seal for the Norphlet Formation where it is productive. The Haynesville would be between the Bossier and Smackover Formations on the diagram below.

Left to right: Generalized cross section along northern GOM region (Galloway et al., 2009), depositional phases are numbered. Relative sea level (Miller et al., 2005), atmospheric CO2 (Berner & Kothavala, 2001) and temperature anomalies (Royer et al., 2004). Click for image. The Haynesville is between the Bossier and the Smackover to the east of the Cotton Valley.

The next four displays are from Cicero & Steinhoff, 2013, depicting the sequence stratigraphy and depositional environments of the Haynesville and Bossier shales.

Map of wells, seismic surveys and cross-sections used in study.
Cross-section B-B’. West is toward the left. The curve on the right represents sea level, rising sea level is toward the left.

This is interpreted seismic profile A-A’, running from north (left) to south (right), just west of the Texas-Louisiana state line.

Figure 3b. Integrated seismic and sequence stratigraphy of dip-oriented seismic line A-A’. Supersequence boundaries indicated in red (SSB), higher-order (3rd+) sequence boundaries with dashed black lines (SB), maximum flooding surfaces (mfs) in green, and transgressive surfaces (TS) pertaining to supersequences in blue. Onlap and downlap indicated with the use of arrows. Dashed vertical lines indicate approximate basement faulting. Modified from Cicero et al. (2010).

The following is a depositional environment (paleogeography) map of the Bossier Shale (~150 million years ago):

“You see the story yet?”

You see the story yet? It’s all pretty much here.
In a language you can’t yet understand, but it’s here.
A tale of upheaval and battles won and lost.
Gothic tales of sweeping change, peaceful times, and then great trauma again.
And it all connects to our little friend.
That’s what we are, we geologists.
Storytellers.
Interpreters, actually.
That’s what you gentlemen are going to become.
And how does this relate to the moon? From 240,000 miles away you have to give the most complete possible description of what you’re seeing.
Not just which rocks you plan to bring back but their context.
That and knowing which ones to pick up in the first place is what might separate you guys from those little robots.
You know, the ones some jaded souls think should have your job.
You see, you have to become our eyes and ears out there.
And for you to do that, you first have to learn the language of this little rock here.


–David Clennon as Dr. Leon (Lee) Silver, From the Earth to the Moon, Episode 10, Galileo Was Right, 1998

HBO’s 1998 From the Earth to the Moon miniseries was a sort of follow-on to the great movie Apollo 13… It’s a must see for space program fanatics. I particularly like this episode because my childhood interest in the space program led me toward the sciences and ultimately geology. Future Apollo 17 astronaut Harrison “Jack” Schmitt recruited his former field geology professor to train the Apollo 15 lunar module team and their backup crew how to become field geologists.  It reminds me of why I love geology so much.  I’ve also had the great honor of meeting Dr. Schmitt at the 2011 American Association of Petroleum Geologists convention in Houston.  Shaking hands with someone who not only walked on the Moon, but also got to throw a rock hammer farther than any geologist ever has before or since, was pretty fracking cool… And so is geology!

References

Berner, R.A. and Z. Kothavala, 2001. GEOCARB III: A Revised Model of Atmospheric CO2 over Phanerozoic Time, American Journal of Science, v.301, pp.182-204, February 2001.

Cicero, Andrea D. and Ingo Steinhoff, 2013, Sequence stratigraphy and depositional environments of the Haynesville and Bossier Shales, East Texas and North Louisiana, in U. Hammes and J. Gale, eds., Geology of the Haynesville Gas Shale in East Texas and West Louisiana, U.S.A.: AAPG Memoir 105, p. 25–46.

Galloway, William. (2008). “Chapter 15 Depositional Evolution of the Gulf of Mexico Sedimentary Basin”. Volume 5: Ed. Andrew D. Miall, The Sedimentary Basins of the United States and Canada., ISBN: 978-0-444-50425-8, Elsevier B.V., pp. 505-549.

Galloway, William E., et al. “Gulf of Mexico.” GEO ExPro, 2009, www.geoexpro.com/articles/2009/03/gulf-of-mexico.

Hammes, Ursula and Ray Eastwood, Harry Rowe, Robert Reed. (2009). Addressing Conventional Parameters in Unconventional Shale-Gas Systems: Depositional Environment, Petrography, Geochemistry, and Petrophysics of the Haynesville Shale. 10.5724/gcs.09.29.0181.

Miller, Kenneth & Kominz, Michelle & V Browning, James & Wright, James & Mountain, Gregory & E Katz, Miriam & J Sugarman, Peter & Cramer, Benjamin & Christie-Blick, Nicholas & Pekar, S. (2005). “The Phanerozoic Record of Global Sea-Level Change”. Science (New York, N.Y.). 310. 1293-8. 10.1126/science.1116412.

Ramirez, Thaimar, James Klein, Ron Bonnie, James Howard. (2011). Comparative Study of Formation Evaluation Methods for Unconventional Shale Gas Reservoirs: Application to the Haynesville Shale (Texas). Society of Petroleum Engineers – SPE Americas Unconventional Gas Conference 2011, UGC 2011. 10.2118/144062-MS.

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Derg
April 15, 2022 2:14 pm

Word salad Bob will be along to tell us windmills are a better option.

Gunga Din
Reply to  Derg
April 15, 2022 3:22 pm

David talked a lot about shale, not schist.

Tom Halla
April 15, 2022 2:19 pm

Good geology lesson.

Robert of Texas
April 15, 2022 2:28 pm

The idea of “flaring” gas just drives me crazy. I understand it from the company’s point of view, but from a national point of view it seems like the government would be subsidizing a pipeline (or 10) through the Permian Basin to collect this otherwise wasted fuel, just like they subsidize electrical towers (so eventually the gas consumers pay for the pipeline over time).

Or, just build some gas driven electrical power plants in the area and connect to the Grid. I know the perfect place to build these stations – just bulldoze the worthless wind turbines down and you have plenty of room for reliable power generation.

The fact that there is a lot of gas underground is no reason to waste it. The U.S. will probably see electricity prices continue to rise even if natural gas prices start to fall – stupidity is expensive and building expensive unreliable power generation is just stupid. Especially when you are building it on top of massive gas reserves.

Gregory Woods
Reply to  Robert of Texas
April 15, 2022 2:49 pm

You should have seen the Saudi Eastern Province before the gas collection program….

bigoilbob
Reply to  Robert of Texas
April 15, 2022 3:47 pm

Not relevant here. per Mr. M. This is dry gas. You have a market for it or you don’t drill for it.

Separately, prudent resource management, and the regs underlying it, have always been on the producers to comply with. Even in Texas. And that includes waste from excessive flaring. The producers knew/know the rules, which is why they subvert them with requesting – and receiving – interminable wink wink “temporary” flare extensions. Or they just do it anyhow and either lie about it or dare the laws to do anything about it.

But again, not a Haynesville issue…

BARRY HOFFMAN
Reply to  Robert of Texas
April 15, 2022 4:18 pm

I strongly agree. I do not understand why the flared gas cannot be captured for on site electricity production. That “seems” to be a no-brainer.

Rud Istvan
Reply to  David Middleton
April 15, 2022 5:05 pm

Yes. Arithmetic by companies that are supposed to make a profit.
A simple ‘math’ example in two parts.
Suppose a fracked well costs $1 million (it doesn’t, is usually ~5, but this is a math cartoon.) Suppose it produces 90% oil and 10% otherwise flared gas.
Now the oil can be transported anywhere by tankers at effectively zero capital outlay.
But the natgas requires a supposed extra $1million capital investment in pipeline (way low).
Then this imaginary well requires $2 million (twice) in capital total, but returns less than 1/10 of that value in gas, and more than 90% in crude. No go financially. Duh!

Carbon Bigfoot
Reply to  Rud Istvan
April 18, 2022 4:58 pm
DMacKenzie
Reply to  David Middleton
April 15, 2022 5:09 pm

a title oops …..Hayneville Shale: Record Natural Gas Production….gimme an “s”

Rich Davis
Reply to  David Middleton
April 15, 2022 5:17 pm

It is clear that building a pipeline doesn’t work financially. What is not so obvious to me is why there could not be on-site storage and a gas turbine that fires up to produce electricity when there is high demand. If windmills are nearby, connecting to the grid should not be excessively expensive.

Why is that a flawed idea?

Rich Davis
Reply to  David Middleton
April 15, 2022 7:29 pm

I understand your point, but I hate waste. Don’t care at all about the CO2 emissions which are not pollution. I also generally hate government regulation. But, I think that if everyone was required to collect into a pipeline or run a gas turbine, that would be a common sense regulation. It could be coupled with tax credits structured to reduce the burden on marginal wells.

The investment decision about making use of the gas vs flaring will be based on risk analysis, right? What would have been profitable is often not done because of the risk of lower prices, and what would not have been profitable enough, though not a net cost, would also not be pursued because better opportunities exist for the capital. If it’s a compliance cost of doing business it will always get done. Without a tax credit, that might lead to a well being shut down. In many cases it would reduce the return on capital.

All of the cases that were risky but ultimately would prove profitable would get done where in the current environment they don’t happen. The financial risk would be borne equally by all and gas production would be maximized.

If we are going to subsidize bird choppers that depend on dispatchable backup, why not subsidize making use of wasted gas?

Rich Davis
Reply to  David Middleton
April 15, 2022 7:39 pm

Now don’t try to sweet talk me with quotes from the greatest President of the past 150 years!

rah
Reply to  David Middleton
April 16, 2022 2:08 am

IMO Lincoln belongs in there. And Madison does not.

Rich Davis
Reply to  David Middleton
April 16, 2022 5:14 am

My GOAT list is
1. Washington
2. Jefferson
3. Lincoln
4. Madison
5. Reagan
6. Coolidge

DJT would rank #2 in my lifetime, maybe #7 on the all-time list.

It’s hard to say whether Brandon is #46 or #45. The WOAT list is a combination of the feckless (Carter, Buchanan) and the destructive (Wilson, FDRoosevelt, LBJohnson, Obama). Brandon needs his own category for corrupt incompetent puppets orchestrated by demons.

Scissor
Reply to  Rich Davis
April 15, 2022 7:56 pm

Look over there. Most federal employees are still working from home, and they’ve never been more productive.

Rich Davis
Reply to  Scissor
April 16, 2022 4:46 am

I’m racking my brain to think of one federal employee who is an essential worker. If every federal worker whose job didn’t exist in 1850 were laid off, how would that be a bad thing?

I must be missing your sarcasm?

Scissor
Reply to  Rich Davis
April 16, 2022 6:46 am

I didn’t communicate it very well.

In any case, you recognized it as sarcasm, so it wasn’t a total fail. I intended my underlying sentiment to be in line with David’s comment.

Reply to  Rich Davis
April 16, 2022 12:08 pm

Your mailman, and many of the USPS who fulfill the Constitution clause for mail service.

Nor are most USPS employees working from home.
Though, I did read a news article that USPS middle management in their HQ and Area offices are panicked.
Since many of those Executive Administrative employees are working from home.

Something about the field processes and delivers mail just fine without their interference.

Rich Davis
Reply to  ATheoK
April 17, 2022 11:55 am

That job existed in 1850. You make my point for me. Also the army. I got one, though. Fighter pilot.

Reply to  Rich Davis
April 16, 2022 11:57 am

“I understand your point, but I hate waste.”

CFOs of a Federal Department were always harping about travel voucher fraud.
Most of the CFOs set up voucher review panels in their Finance departments comprised of secretaries or clerks with limited math skills trying to spot fraud.

The HQ Finance Vice President established a professional team of financial analysts to investigate travel vouchers.

The study lasted longer than a year. When the CFOs gathered into a national planning session/meeting, the Finance VP presented the findings.

Errors, not fraud were rampant. Many of the errors were in favor of the Agency.
Errors claiming amounts in excess was around $50,000.
Errors claiming less than proper was around $75,000.

Most employees were reimbursed correctly after the errors were found.
No-one was charged with actual fraud.

Cost of the investigation? Well in excess of $150,000. Not counting the analysts’ work hours.

When the VP asked if the travel voucher investigation should continue, the majority of the CFOs voted, “Yes!”

The VP snarled some nasty comments about irrational wasteful government officials, then bluntly stated that the government was not wasting money far in excess of found voucher errors. He left the meeting.

Waste of flared gas or waste the money and equipment to capture a pitiful amount of gas? Gas that you can rarely recapture expenses, let alone profit.

Last edited 1 month ago by ATheoK
mal
Reply to  Rich Davis
April 16, 2022 6:28 pm

In all cases subsidizing anything is a bad idea(it distorts markets.) A lot of gas cannot be burned directly it often need to be clean up first. Sulphur is one of the big items that need to be removed.

Rich Davis
Reply to  mal
April 17, 2022 11:00 am

Help me out here, mal. It can’t be burned directly so we have to burn it directly (flare it). Did I understand you correctly?

As always, the perfect is the enemy of the good. By your logic, because some flared gas may be unable to be used in a gas turbine, therefore all flared gas should be wasted.

Rich Davis
Reply to  mal
April 17, 2022 11:19 am

I also agree with the view that subsidies are generally bad. There will always be unintended consequences from distorting a market. Certainly there would be no bald eagle mincers despoiling the fruited plain if we didn’t have subsidies and mandates.

Where I part company is in your formulating it as an absolute. I’d reserve the possibility that something can be in the public’s general interest that is not aligned with the interests of a company. Providing an incentive to act in the public’s best interest, or forbidding certain actions that would be profitable or less costly on the grounds that those actions are opposed to the public interest is not something that should be opposed as an absolute rule.

Michael S. Kelly
Reply to  David Middleton
April 15, 2022 7:27 pm

A couple of young entrepreneurs have made a killing by putting electric generators at flare sites, and using the power produced to mine bitcoins. https://www.cnbc.com/2022/02/12/23-year-old-texans-made-4-million-mining-bitcoin-off-flared-natural-gas.html

Bitcoin mining is a hugely computationally intensive process, and the drain on electric power grids is serious. The process involves solving very difficult mathematical problems. As an example, one of them starts with “A train leaves New York at 8 am, travelling west at 60 miles per hour…” You get the drift. Hard stuff. Barbie hard mathematics…

Whether it actually adds wealth to humanity or not, I can’t say. But at least someone is willing to pay for not flaring gas.

Loren C. Wilson
Reply to  Michael S. Kelly
April 15, 2022 9:15 pm

The issue is that the gas is not ready to be burned in a generator or other engine. It has too much CO2 or H2S or water in it and has to be cleaned up (scrubbed) first. This is usually done in very large facilities because this is the most economic method. Small units cost more to operate per cubic foot of gas cleaned. This decreases the economics to the point that is cheaper to flare than to utilize the gas. Think about recycling – my neighbors pay to recycle. Therefore, it is logically clear that more resources go into recycling their paper and plastic than just landfilling it and making new. More resources means more pollution. Sadly, most household recycling actually creates more pollution than it saves. Industrial recycling pays and saves resources and reduces pollution.

Rich Davis
Reply to  Loren C. Wilson
April 16, 2022 4:30 am

LCW—I’m not sure that as a blanket statement that your facts are correct. There must certainly be some cases where you are correct that the gas composition is not usable in a standard internal combustion engine, but there very likely are also many cases where gas is being flared even though it could be used “raw” in suitable equipment.

Anyway, I was not talking about using it in an internal combustion engine like a generator, but in a gas turbine.

My suggestion was that if it were a regulatory requirement to capture or make use of all the methane without flaring, then the least-cost approach would no longer be flaring, which I imagine entails near zero capital expense.

The least-cost approach might then be a gas turbine on site, with a compressor and a storage tank, on a trailer that can be moved from well to well over the lifetime of the turbine and/or swapped out for periodic maintenance.

If the turbine were to be operated only when power can be sold at a high price (the purpose for the storage tank), that could make the capital cost pay off.

Even in a rational world that stops disrupting the grid with intermittent sources, having peaking units is a real need.

Robert J Doyle
Reply to  BARRY HOFFMAN
April 15, 2022 6:44 pm

The explorers are producing electricity at the platforms.
“Capstone Turbine” of California is the manufacturer. The use of the turbines by the
petroleum industry was a life saver for Capstone. You, see, even though local micro-turbines are much more efficient than Wind or Solar and being local, don’t have the line loss.

Department of Energy published comparisons. However, this industry segment does not have the grease for the needy palms.

Take a look at their site.

I do not own stock, cause you can’t play in a rigged game.

Reply to  BARRY HOFFMAN
April 16, 2022 5:54 am

Turning gas into electricity at the wellhead works at Elswick.

The natural gas produced from the well at Elswick has been used to generate 1MW of electricity on site continuously during its early life. Gas extracted from the sandstone formation was sent to a small onsite generator, and electricity generated fed into the electric grid via underground cables.

I once tried to raise interest in a new gas play in the SNS Permian Zechstein reef belt turning the gas into electricity offshore. The opportunity was crossed by power cables from windfarms but the concept did not fly for tax reasons.

RickWill
Reply to  Robert of Texas
April 15, 2022 6:45 pm

The U.S. will probably see electricity prices continue to rise even if natural gas prices start to fall 

More accurately, retail electricity prices WILL rise.

Once the decision is made to allow the connection of intermittent generators, the trajectory for retail price rises is cast.

In Australia, there has been a reduction in the wholesale price of electricity over the past 4 years. But the retail price has the opposite trajectory.

Australia is the most technically advanced region for integration of intermittent generation. The whole country has achieved a peak penetration of 61% and and now averages 34%. Most of that is from intermittent generation.

There is a whole raft of new costs that did not exist before intermittents were connected. FCAS charges are rising rapidly; cost of directions are a new category; dispatchable capacity payment will be a new category from 2025; there are dramatic increase in transmission infrastructure to pay for; there are synchronous condensers to pay for; there is pumped storage to pay for; so far batteries have not added cost but they rely on income from FCAS payments and price arbitrage (both opportunities the consequence of intermittency) and distribution networks are being strengthened to cope with distributed solar generation from rooftops – the fastest growing generation sector in Australia.

Wholesale electricity cost is down to 20% of the retail cost in NSW. All the intermittents in Australia have negative marginal cost of generation as a result of subsidies. That is driving the wholesale price down and making coal generators uneconomic.

No matter what happens with generation in the future, all the capital spent to accommodate intermittents is locked into cost recovery processes that will be recovered from the coming generations of electricity consumers.

Gary Pearse
Reply to  Robert of Texas
April 16, 2022 9:42 am

“Or, just build some gas driven electrical power plants in the area and connect to the Grid.”

But…wouldnt that be intermittent energy? Oh yeah we would have windmills for backup.

Gunga Din
Reply to  Robert of Texas
April 16, 2022 9:48 am

Some wastewater plants also flare the methane from their anaerobic digesters. It’s not practical to do otherwise.
(I did tour one once (30 or 40 years ago) where one motors their pumps was could run off that methane in a pinch.)

Rud Istvan
April 15, 2022 2:40 pm

Interesting discussion of well depth and economics of Marcellus compared to Haynesville. The Utica underlies Marcellus at about Haynesville depths, which is why only the shallow western Utica oil zone (eastern Ohio) has been drilled to now.

Rud Istvan
Reply to  David Middleton
April 15, 2022 5:10 pm

Yup. I doubt anybody knows Utica potential. Supposedly up to 300 meters thick over 1000kms of km2. BIG!

Phil R
Reply to  David Middleton
April 16, 2022 5:37 am

Except in the Democratic People’s Republic of New York…

ResourceGuy
April 15, 2022 2:41 pm

It benefits from a lot of pipelines and reasonable access, but it’s not going to be enough for what has been loaded on demand from utilities at formerly-low prices and more exports. There will be a lot drilling though.

Bob Tisdale(@bobtisdale)
Editor
April 15, 2022 2:44 pm

Thanks, David, for another educational post.

Regards,
Bob

PS: I believe I’ll have to study it a second time, probably tomorrow morning, because my brain is full right now, and I’m retaining little.

Matt Kiro
Reply to  Bob Tisdale
April 15, 2022 6:11 pm

That’s what I feel like. More information and facts in twenty five minutes of reading of one of Mr Middletons posts than twenty five years of climate hysteria

angech
Reply to  Matt Kiro
April 15, 2022 6:17 pm

Man on a mission. [Sorry David too important not to blog.] Could you do this article in a better way please?

Stop the Ukraine War.
Use the power of Watts up with that .

The power of individuals to enact change on their own is minute.
Collective action is a little better but is limited takes a lot of time and effort.
Social media allows Multiple groups across the world to engage in collective action at the same real time.
This magnifies the ability to create change quickly.

The wear in the Ukraine needs action on multiple fronts.
It needs leadership from the major representatives of our countries and grass roots action.

The United Nations must unite and put out a call for the war to stop immediately.
The aggressor, in this case Russia, should be stripped of all rights of representation at all levels until the war stops.

Europe and Nato must issue similar calls for the war to stop and offer to put in peacekeeping forces now.
The United Nations, Europe and Nato should send peace keeping forces in regardless now.
Not to fight unless fired on.
Only to go in if Ukraine supports their coming in.
 To leave immediately if the Ukraine requests.
 With a large number of countries represented by troops on the ground Russia will have to halt its indiscriminate bombing.

The USA should also offer to send troops in on these conditions
All other world countries including the big two India and China should help.
 People on the ground, not fighting but ready to respond would create a situation the Russian army would not want to upset.

Volunteers could be called up to go in such a situation, similar to the Spanish Civil war, not to fight but too prevent fighting.
The slow build up and reluctance to take even a defensive helpful position has created an extremely bad image for all nations.
This would not be needed if the nations of the world do what they should have done in the first place.
Time for them to step forwards and act, not aggressively, but defensively, saying we are all in this together.
 Send enough people in so the Russians cannot kill people.

The other side of the coin is the Russian people themselves.
A reckoning needs to be called within Russia.
Over the last 10 years the Russians have been mixing better with the rest of the world on the internet and logistically.
People in St Petersberg and Moscow have enjoyed freedoms that they thought were guaranteed until now.
 Social Media impact must register and does register.
 Everyone who has an option, tweeting, facebooking [if allowed], phoning should do it.
 They need to push and push for peace with their politicians.
 They must put out a call for the Russian people to take action and demand their leader change course.
This is possible in the new Russia, and needs people to be reassured that their actions will be supported.

Reply to  angech
April 16, 2022 12:45 am

We have a saying downunder – “A cup of tea, a Bex and a good lie down

Derg
Reply to  angech
April 16, 2022 3:20 am

Go help the people of North Korea

Reply to  Derg
April 17, 2022 12:50 am

Good point – horrific that in the last 30 years NK people are stunted by malnutrition and starvation.

RickWill
April 15, 2022 6:27 pm

The knowledge to unravel the story of rocks is not trivial. It requires extensive understanding of physical processes occurring on Earth and its relationship to the universe; built on generations of observations.

There is a growing gap between understanding the physical processes and wishful thinking. A key reason is that the cosseted set in places like DC in the USA, Canberra in Australia, Brussels in the EU and London in the UK live in a make-believe world where influence is the prime currency. Knowledge no longer counts.

These privileged locations should be dismantled so the law makers and administrators get to live amongst those they rule.

Australia is a few days into a Federal election cycle. The main party leaders have been out among the plebs, away from their cosseted environment. The current opposition leader is proving an embarrassment each time he opens his mouth away from his Canberra hole but that could mean he gets the pity vote.

Ron Long
April 15, 2022 6:33 pm

Thanks, David, a nice update on a major gas producer. The Mancos Shale (Cenomanian) of New Mexico to Montana, age about 100 million years ago, also is a major transgression, which leads one to wonder, how did these transgressions (fast/catastrophic sea level rises) happen without SUV’s producing CO2 to power the system? Natural? That means the entire CAGW premise is in question as natural variation covers quite an extreme.

Joel O'Bryan(@joelobryan)
April 15, 2022 10:30 pm

drove across the I-20 corridor of Pecos to Midland last night. I noticed seemed not as much gas flaring as I’ve seen in past months. that is a subjective obs. because there’s still lots. lots over the horizon for sure.

rah
April 16, 2022 2:01 am

Dr. Schmitt broke the formula, being the first non-pilot to become an astronaut. It was not a very popular move with the astronauts who were excess and knew that the Apollo program was going to be shut down after 18 so they would never get a seat. Deke Slayton, who ran the training and selection program at the time, had to be ordered by the director to put him on the crew.

So his Apollo ride marked the end of the test pilot dominance and the beginning of scientist crews at NASA.

rah
Reply to  David Middleton
April 16, 2022 9:01 am

Sure, they had engineering degrees but David, if the astronauts were so good at geology then why did the Director of NASA feel it necessary to order Deke to take Schmitt?

rah
Reply to  David Middleton
April 16, 2022 9:15 am

BTW, Michael Collins gets into the rile up about Schmitt being sent. He is neutral on the point it seems, but describes the angst of other astronauts on the issue. It can be found in his book Carrying The Fire.

I personally think that sending Schmitt was the logical thing to do.

Collins makes no bones about his dislike of Buzz Aldrin. So he is not being PC but lays it out as he sees it. Out of all the astronauts, I got the impression that Collins thought that Armstrong and White were the two he thought most capable.

George Daddis
April 16, 2022 7:46 am

I lived in the SW corner of NY state, populated by multigenerational farm owners whose land was now providing a minimal return and what we called “Birkenstockers”, honest and simple living Leftists, retired teachers and others who had tired of a corporate grind.

NYS law prevented the farmers from benefiting from their land (as neighbors south of us in PA were able to) and the “do gooders” sided with the state in the propaganda that fracking would poison their wells.

At least some of us mounted an effort to stop the encroachment of industrial wind sites, which had despoiled the NYS town just south of us.

(We wrote into our small town’s building codes and other regulations limits on height but more importantly required a bond upfront to return the site to natural conditions at end of life. I have no idea of whether that was the reason the hills over our tiny Finger Lake were spared or even if it would have stood up to legal challenge, but as Harry Reid said, “It worked, didn’t it?”.)

Andy May(@andymay2014)
Editor
April 16, 2022 12:36 pm

Thanks Dave, really good. I worked on the Hayneville Shale as a petrophysicist from 2008 to 2012 for Devon Energy, it is a remarkable formation. The combination of a relatively ductile formation and a very high organic content leads to very high pore pressures in the deepest part of the basin where the pore pressure gradient can exceed 1 psi/foot. Like drilling into a bomb.

Andy May(@andymay2014)
Editor
Reply to  David Middleton
April 17, 2022 6:31 am

Hi Dave, Your story about losing your well reminded me of a field I worked a long time ago, Chapel Hill, near Tyler, Texas. It was discovered by the legendary “Dad” Joiner in 1930. The discovery was later purchased by H.L. Hunt for over one million dollars. It made Hunt’s fortune. I remember plugging the discovery well, the Daisy Bradford #3. The whole story, which is very interesting, can be seen here.
East Texas Oilfield Discovery – American Oil & Gas Historical Society (aoghs.org)

Derg
Reply to  David Middleton
April 16, 2022 11:56 pm

I think it was BigOil..the word salad troll 😉

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