Permian Slowdown Clouds Future Gulf Coast LNG, but ‘Remodeled’ Haynesville More Attractive

Future Gulf Coast natural gas export development may become “risky” if Permian Basin associated gas production doesn’t recover, IHS Markit executive director Sam Andrus said in San Antonio this week.

Speaking at the LDC Natural Gas Forum, Andrus said production economics are crucial, given the lack of capital available. After oil prices plunged to historic lows in April and Covid-19 decimated energy demand, Permian producers tapped the brakes on activity in the prolific play that spans West Texas and southeastern New Mexico.

While cutting costs, some producers have grown production amid the continued weak price environment. However, output is generally expected to hold steady in the 11.0 Bcf/d range through 2021. In the latest Short-Term Energy Outlook, the Energy...