The Barnett Shale is more than 7,000 feet below the surface and is comprised of dense non-permeable rock. According to Dr. Ken Morgan, a geologist at Texas Christian University, “Solid hard rocks that are 7000 feet down don’t subside. You have more than a mile of solid rock that holds it all up. Subsidence occurs when you have loose, soft materials like in Houston (sands, clays, etc.) but not in cemented hard rocks like the Barnett Shale.”
Look Beneath the Bloom for the Vitality of the Barnett Shale
As noted in a recent Star-Telegram article “In the Barnett Shale, the bloom is off the boom,” by Jack Z. Smith, drilling activity in the Barnett Shale is at a seven-year low of just over 50 rigs running, which is roughly one quarter of the rigs that were running in 2008. While the number of drilling rigs is noteworthy, it is not a good measure of the continuing vitality of the Barnett Shale.
For example, the recent economic impact study by The Perryman Group (TPG) noted that the Barnett Shale is still one of the most significant economic engines in North Texas. Activity in the Barnett Shale is still generating more than 100,000 jobs and over $11 billion in economic activity annually for the region. TPG noted that “even though the Barnett Shale activity was virtually nonexistent 10 years ago, the Barnett Shale’s effects are now larger than the contributions of other, long-time sources of economic success in the area: larger than aircraft manufacturing, air transportation, including Dallas Love Field, Dallas/Fort Worth International Airport and Fort Worth Alliance Airport, and motor vehicles.”
It is also notable that natural gas production in the Barnett Shale continued to increase for the last two years while drilling was declining due to improved drilling techniques. Production appears to have flattened out in recent months, but this is due to low natural gas prices, not because the Barnett Shale lacks potential. The Barnett Shale has plenty of natural gas left, with official remaining reserves of 40 trillion cubic feet or another 40 years (or more) of production. Unofficial estimates of the remaining reserves are doubled when existing and potential technological advances are figured in.
In general, the potential reserves of shale gas and other energy sources are tied to technology. When wells could only be drilled a few hundred feet, natural gas and oil reserves were indeed limited. But drilling technology has evolved and natural gas and oil wells are now drilled down more than a mile and then turn to drill horizontally for thousands of feet more before the wells are hydraulically fractured. Due to this technology, natural gas reserves in the United States increased when the Barnett Shale started being developed in the early 2000s and domestic reserves of crude oil turned up last year.
What we are witnessing in Barnett Shale activity now is the effect of market forces. The fact is that the energy industry did such a good job in developing “game changing” technologies that there is now more natural gas available than the market can absorb. But as more natural gas-fired electricity-producing plants are built, as is being encouraged by the Environmental Protection Agency, and more cars and trucks switch to natural gas, market forces will move the drilling rigs back to the Barnett Shale and the economic benefits to the region will continue for decades to come.