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Oil & Gas ProPermalink Reply by Skip Peel - Mineral Consultant on August 8, 2024 at 6:41

"Associated gas" out of the Permian Basin depresses the price of natural gas produced from Ark-La-Tex Haynesville and Cotton Valley wells.  As more takeaway capacity is built and comes on line to transport associated gas to the Gulf Coast, supply will increase and producers will be hard pressed to balance supply with demand.  Permian's oil focused companies care little about the price of natural gas.  They wish it wasn't a cost to them but any marginal profit is okay.  By marginal I mean they can make money at prices below $2 and possibly $1.  Before flaring was cut back, they would just as soon burn it than put it in a pipeline.

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