UT Study: Fayetteville Shale to Contribute to US Gas Supply for Years


The Fayetteville Shale, considered one of the most productive shale gas basins in the United States, will continue to be one of the largest contributors to the country’s natural gas supply for many years, a study by the University of Texas’ (UT) Bureau of Economic Geology (BEG) in Austin said.

The study, funded by the Alfred P. Sloan Foundation, used the same methodology as the bureau’s 2013 assessment of the Barnett Shale’s natural gas production. The methodology used by BEG was designed to be one of the most rigorous assessments of production in U.S. shale gas basins. It integrates geology, economics and engineering into its assessments. The Fayetteville Shale assessment drew production data from individual wells that were drilled in the shale formation from 2005 to 2011. The assessment concluded that technically recoverable gas reserves for the region are 38 trillion cubic feet (Tcf).

About 18 Tcf are estimated to be economically feasible to recover when natural gas prices are close to $4 per million cubic feet (MMcf). However, the production outlook is only somewhat sensitive to the price of natural gas, the BEG team said.

The assessment forecasts that using a $4/MMcf natural gas price scenario, the Fayetteville Shale would reach a plateau sometime in the period of 2012-2015 before gradually declining as the well count decreased.

Whether production within the Fayetteville Shale is economically feasible or not depends on production quality tiers, which vary widely in the formation. The UT BEG team identified, mapped and studied 6 production-quality tiers across the formation to forecast future production data. From this data, researchers mapped feasible drilling locations based on the amount of gas-in-place and economic data.

However, the study showed that low-performing wells exist next to high-performing wells, just as in conventional oil and gas basins, said Scott Tinker, the BEG’s director and co-principal investigator, in a statement on UT’s website. The study may help in showing where future drilling activity is likely to occur, and the economic conditions that would make drilling there economic, Tinker added.

The Fayetteville Shale formation holds natural gas in a fine-grained matrix, and hydraulic fracturing is required to release the gas, according to the University of Arkansas. The average well in the shale formation has been estimated to hold 1.3 billion cubic feet of gas, the U.S. Energy Information Administration (EIA) said in its Annual Energy Outlook 2012.



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