Natural Gas Will be a Boom for Eagle Ford Companies

Eagle Ford Companies to Export Natural Gas
Eagle Ford Companies to Export Natural Gas

Eagle Ford midstream companies looking to prosper as natural gas exports overtake imports over the next 16 months.

Related: First Eagle Ford Crude Ships to Europe

In its latest, Short Term Energy Outlook, the Energy Information Administration (EIA) reported that in 2017, natural gas exports will surpass imports for the first time since 1955. With hundreds of miles of natural gas pipelines heading from the Eagle Ford and Permian Basin to the Gulf Coast, the liquefied natural gas industry is poised to deliver the majority of those exports.

Natural gas working inventories were 3,643 billion cubic feet (Bcf) on January 1, which was 17% higher than during the same week last year and 15% higher than the previous five-year average (2011-15) for that week. EIA forecasts that inventories will end the winter heating season (March 31) at 2,043 Bcf, which would be 38% above the level at the same time last year. Forecast Henry Hub spot prices average $2.65/million British thermal units (MMBtu) in 2016 and $3.22/MMBtu in 2017, compared with an average of $2.63/MMBtu in 2015.

With the current forecast for natural gas, the San Antonio Biz Journal recently highlighted five Eagle Ford companies that are positioned to take advantage of these markets in 2016.

  1. Howard Energy Partners: With acreage in Webb County, Howard plans to build a 200-mile pipeline to deliver 600 million cubic feet of natural gas per day to Mexico
  2. Lewis Energy: A top producer with positions inLa Salle, Webb and Dimmit Counties.
  3. Energy Transfer Partners: ETP already has natural gas export capabilities in Webb County and the Rio Grande Valley.
  4. Sanchez Energy: With tens of thousands of acres in the natural gas-rich lands of La Salle, Dimmit and Webb Counties, Sanchez entered a joint venture worth$115 million to bridge connections to Mexico.
  5. Flint Hills Resources: Has petitioned the federal government to ship LNG oversees.