Haynesville Shale drilling activity in Louisiana is seeing a 32-month high. Here’s why.

BY LIZ SWAINE | Staff writer  Shreveport-Bossier Advocate

https://www.shreveportbossieradvocate.com/business/haynesville-shal...

Winter Storm Fern is over, and the bounce it gave the price of natural gas may be, too.

During the five days that were Fern's coldest and then for several after, natural gas prices jumped to a four-year high and heavy usage erased a winter storage surplus. Both spot prices and price projections for the year rose.

What a year it has been for natural gas.

In June, the price per million British thermal units slumped to an all-time low price of $0.56 mmBtu according to National Gas Intelligence. For the better part of the summer, the price languished around $2.65 mmBtu.

Fern changed things in a big way, but only temporarily. The extreme cold combined with power plant and other equipment malfunctions pushed the price of natural gas to over $30 per mmBtu. In some zones of the U.S., the spot market soared to nearly $80 mmBtu.

Spikes during extreme cold are not uncommon. Shreveport mineral consultant Skip Peel said utilities buy natural gas based on their normal winter use and capacity. "But then you get a cold snap during the middle of the month, and you run out of your allotment before the end of the month, and then you've got to go back and buy more on the spot market, which will cost you more."  

Those spot prices have now reset with the current milder forecasts. Natural gas futures fell another 8% on Monday to settle in at near $3.11 mmBtu.

Haynesville Shale drilling is up

Even though prices are lower than what drilling, exploration and production companies would like, Louisiana Haynesville Shale activity has seen a bounce and urban leasing continues at a fast clip. 

Last week, drilling activity in the Haynesville Shale jumped to a 32-month high with action led by APEX Natural Gas. RBN Energy reported the Haynesville Shale rig count on Feb. 6 at 64, up six rigs for the week and 26 for the year.

Peel says there is a reason for that. Companies like APEX are more interested in future consumption overseas than current prices.

"That's the next big demand spike. And later this year or maybe next year will come another demand spike when data centers go online. So, you know, investors are looking long term and they're seeing two or three things that are favorable for natural gas demand over the next few years."

There is also additional LNG capacity coming online later in 2026 in Louisiana and Texas.

"These rigs are drilling now, but, you know, the wells won't be completed for some weeks or months. When that new LNG capacity comes on, you could have some wells sitting there ready to be turned to sales," Peel said.

"There's foreign countries, like Japan being the prime example for the Haynesville Shale, that are investing."

Aethon, which has played a role in the Haynesville Shale since 2017, is selling its assets to Japan-based Mitsubishi Corporation. The $7.53 billion deal is supposed be finalized by June.

Peel says the Haynesville Shale is changing in other ways, too.

"At the first it's south Caddo and north DeSoto Then, it's all of DeSoto, then it's a bunch of Red River, then it's Sabine Parish, and that growth happened over a couple of years, so the industry is running to try and catch up with itself."

Email Liz Swaine at Liz.Swaine@theadvocate.com.