To borrow from the time-tested real estate maxim, the single best thing about the Haynesville Shale is “location, location, location.” Situated in the shadows of the Grand Central Station of natural gas consumption along the Texas-Louisiana Gulf Coast, the play is competitively advantaged by short distances from producing well sites to major points of consumption—namely the region’s massive petrochemical/industrial complex as well the most comprehensive natural gas liquefaction and export corridor on Earth.

Already the nation’s third-largest gas-producing basin behind Appalachia and the Permian, another “best thing” about the Haynesville play is its expansion over the past 17 years both aerially to encompass a large swath of North Louisiana and East Texas as well as vertically to produce from the Haynesville, Bossier Shales and Cotton Valley sequences. The Haynesville play is proven and now it is primed for growth. In a word, Haynesville operators are feeling optimistic.

Given the growing demand for U.S. natural gas around the world and the short hop to the Gulf Coast’s consuming and export epicenter, Haynesville operators such as Comstock Resources Inc., Sabine Oil & Gas Corp., Quantent Energy Partners LLC, and Empresa Operating LLC are hoping the best is yet to come.

The return of normal frigid winter temperatures to start 2025 has a lot to do with a generally improving outlook for U.S. natural gas markets. Haynesville operators are primed with growing optimism.

The International Energy Agency projects that global gas demand will grow by a net 5% by the end of this year compared to year-end 2023, and cites a “fragile” balance between demand and supply trends.

Western Haynesville

Comstock is adding two rigs this year, boosting its companywide rig count to seven, as it picks up the pace drilling on a 518,000-net acre position in the Western Haynesville, where initial well productivities have topped 40 million cubic feet a day, says Chief Executive Officer M. Jay Allison.

In late February, the Frisco, Tx.-based company unveiled the configuration of its Western Haynesville footprint, which consists of 20,000 leases, including new leases and the deep rights from several operators in the area. In 2024, the company doubled the size of the segment with 265,000 net acres at a cost of $401 per acre. Now Comstock’s Western Haynesville land acquisition phase is over as Comstock gets down to the business of development, Allison says.

Comstock Resources Inc. has prepared for the “golden age of natural gas” by positioning itself on the leading edge of technology to unlock the Western Haynesville, where it has amassed a 518,000-net acre position and brought in newly completed wells with IPs exceeding 40 million cubic feet a day.

Four rigs this year are expected to drill 20 Western Haynesville wells after Comstock turned 11 to sales in 2024 with average IPs of 38 MMcf/d. Producing from a 12,055-foot lateral, the Hogue No. 1 led the pack at 44 MMcf/d of initial output.

Growth in the western position, located between Dallas and Houston in Freestone, Leon, Limestone, and Robertson counties, and its proximity to the Gulf Coast are getting attention from gas purchasers, Allison points out. About 68% of Comstock’s overall gas production from 819,000 total acres is already being sold into the Gulf Coast market.

“With our location, LNG companies, utilities, data centers and industrial users are contacting us about being future suppliers,” he reveals. “They need this substantial natural gas reserve in proximity to growing Gulf Coast demand . . . and they will continue to need it for decades.”

Armed with logs from numerous vertical wells in the area and other geologic data, Comstock started acquiring Western Haynesville acreage in 2020 and completed its first well, the Circle M, in April 2022. Given the success, the company opted for organic growth over adding reserves and production through mergers and acquisitions.

“That is a lot riskier because the challenge in the Western Haynesville was not geological,” Allison recalls. “We were very confident about the Haynesville and Bossier shales there, but we did not know if we could meet the challenge of drilling 10,000-foot laterals with temperatures that exceed 400 degrees Fahrenheit 19,000 feet down.”

Rising To The Challenge

Comstock’s operations team rose to the challenge. Seven wells were on production by the end of 2023, and by the end of last year, 18 were online. Success in the region is a testament to evolving technology, he says.

“I believe the golden age of natural gas is here, and it is here because of technology,” Allison states. “We chose to be on the leading edge of technology to unlock the value of the Western Haynesville. It is about innovations in downhole motors and coated drill pipe, pressure control when you produce the wells, and many other technological areas.”

About 80% of the Western Haynesville is held by production. Comstock plans to drill some 70 wells over the next five years to hold its entire western acreage footprint, he adds.

Over time, the company has substantially reduced Western Haynesville well costs. Drilling expenses are down 33% and completion costs per lateral foot have declined by 28% since the Circle M was completed three years ago.

The accomplishments on the western front would not have happened without the support of Dallas Cowboys owner Jerry Jones and his family, who own 71% of Comstock and who “got down into the weeds with us in the Western Haynesville,” Allison remarks.

Another significant factor is that the company operates its own gathering system with partner Quantum Capital Solutions committing $300 million to build out treating and gathering systems, he goes on.

Returns in the Western Haynesville may be superior to the core of 301,000 net legacy acres in northern Louisiana and farther east in Texas, where Comstock got its feet wet in the play and where it still has 1,300 drilling locations.

“But the stability of our core allowed us to go out and drill the first several Western Haynesville wells and lease the first acreage in 2020-21,” Allison remarks. “Without the stability of the core, we would not have been able to reach out. The core shored up our balance sheet and funded testing of this exploratory play.”

Last year, the company turned 37 legacy Haynesville wells to sales. Average IPs were 23 million MMcf/d from an average lateral length of 10,104 feet. The Turner 16-21-28 No. 2, producing from a 13,539-foot lateral, posted an IP of 42 MMcf/d. While legacy work continues to be a mainstay, the Western Haynesville position is key to Comstock’s future, Allison says.

“At the beginning of our undertaking to de-risk the Western Haynesville well by well, we made sure that 100% of our team held no distorted view of reality,” he offers. “Reality is truth. There is an old cowboy saying that if the horse is dead, dismount. Our Western Haynesville horse looks to be very much alive and potentially a triple crown winner, even a Secretariat in the making.”

East Texas Position

While news of exploits in the Western Haynesville rightfully get attention, a reliance on organizational and operational continuity is helping Sabine Oil & Gas Corp. quietly expand an East Texas position prospective of the Haynesville and Cotton Valley, says Chief Executive Officer Carl Isaac.

Acquired in 2019 by Osaka Gas USA, the Houston-headquartered company maintains a drilling pace of 25 wells per year with three rigs, developing 131 Haynesville and 55 Cotton Valley wells since 2017 as it takes advantage of the latest innovations to improve results and reduce expenses.

The methodical approach continued through the pandemic-induced downturn of 2020 when the basin rig count fell from 81 to 31 rigs, Isaac notes. It persists with a goal of continually replacing acreage drilled and supporting 450 MMcf/d of net production now sold at the Carthage Hub in Panola County.

With a 300,000 net-acre position in East Texas, Sabine Oil & Gas Corp. has extended lateral lengths to an average of 9,900 feet in the Cotton Valley and 11,000 feet in the Haynesville as it ramps both operational efficiencies and well productivities.

Throughout the process, Sabine had held to a low-key approach that has helped the company achieve success since the executive group arrived in 2017 after the company emerged from bankruptcy, explains Isaac, who was named CEO in 2023. Well results and other measures of operational performance are typically kept confidential.

“We do not draw a whole lot of attention to ourselves. The people we do business with know who we are and what we do in East Texas. We continue to be very intentional in our effort to be a good neighbor with our partners, mineral owners, landowners, and the communities we operate in,” he states. “That is foundational to our ability to do farm-ins, joint developments and all that we do to grow our business.”

The addition of 100,000 net acres since 2019 stems chiefly from farm-ins with established operators, explains Chief Financial Officer Elliott Kruppa, who also directs business development. The company’s 300,000 net-acre position on a 400,000-gross-acre footprint is spread across Harrison, Panola, Rusk, Gregg, Upshur, Smith, and Cherokee counties.

“We also have done an acquisition for development rights in East Texas,” Kruppa reports. “Organically, we have a highly active leasing program and do smaller bolt-on acquisitions where it makes sense. We have been very active since 2019 and increased our footprint. We will continue to be active and look forward to expanding our footprint in those East Texas counties.”

Driving efficiencies are evolving technologies that include deploying the latest bits, offline cementing, completions utilizing dissolvable plugs, and ever-improving viscosity friction reducer technology, he says. Dual-fuel engines are common on frac spreads and rigs with a focus on emission reductions that since 2019 have seen a 50% overall reduction.

In addition to the contribution of technology, incremental increases in horizontal lateral lengths are a testament to improved economics and the expertise and improved execution of Sabine’s operations team, Isaac insists.

“In both the Cotton Valley and Haynesville, laterals continue to get longer by 5-10% a year,” he says. “In 2018, we averaged 7,500 feet in the Cotton Valley and 9,950 feet in the Haynesville. We are now averaging about 9,900 in the Cotton Valley and close to 11,000 feet in the Haynesville, where we have touched 14,000 feet.”

Midstream consolidation, developments, and pipeline expansions have come with challenges in volatile gas markets as area gas competes with more Permian supplies at the Katy Hub west of Houston and the anticipated connection of Permian gas directly to Carthage, Isaac says.

However, new pipeline capacity tying the region to the Gillis, La., hub that feeds LNG terminals and Gulf Coast petrochemical centers will provide additional outlets for Sabine. Those projects include Energy Transfer’s Gulf Run Pipeline, Williams’ Louisiana Energy Gateway (LEG), Pelican Pipeline, LEAP Expansion, and Momentum’s NG3 project, he adds. Also helpful is the long-term view from Osaka’s ownership, Isaac says.

“We have the luxury of having a parent company that likes to talk in terms of the year 2050. That gives us a long view for building a business that is sustainable over the long haul.”

Haynesville Newcomer

While others exploit new regions and stay a course of consistent growth, Haynesville newcomer Quantent Energy Partners LLC looks to add to an 11,000-acre lease position after acquiring 7,000 Louisiana acres last year from EnSight IV Energy Management LLC.

“EnSight was a marketed process we closed on, but going forward, we are looking at bolt-ons that are privately negotiated while continuing to look out for publicly marketed deals,” says Chief Executive Officer Kevin DeLay. “Although our current assets are in Louisiana, we are agnostic to growth in either Texas or Louisiana.”

Formed in the summer of 2024 and backed by Post Oak Capital L.P., the Oklahoma City-based company is looking to run one rig this year as it focuses on potential additions that allow for 10,000-foot or longer laterals in the Haynesville and Bossier shales to take advantage of inherent efficiencies, DeLay explains.

Formed in the summer of 2024 with backing from Post Oak Capital, Quantent Energy Partners LLC is looking to add to an 11,000-acre lease position after acquiring 7,000 Louisiana acres last year from EnSight IV Energy Management LLC.

He says the degradation of estimated ultimate recoveries is typically minimal in longer Haynesville wells. Advancements in high-temperature motors and elastomers, and other innovations that support larger completion designs, will continue to boost efficiencies and well predictivity across the play, DeLay predicts. Talent will continue to make a difference as well.

“The Haynesville is a great story of technological breakthroughs in the oil and gas industry to unlock a play, and Quantent has a team of experienced oil and gas professionals to make a difference for us,” he says.

DeLay has worked the Haynesville for a decade and multiple basins during a career that includes time at Devon Energy and a stop as general manager for the late Aubrey McClendon’s Chesapeake Energy Corp., where DeLay helped build a portfolio that eventually grew to more than 14,000 wells across the country.

While the Haynesville, like other basins, has seen consolidation from larger companies merging and others divesting positions, available locations are becoming more scarce and increasingly valuable, he observes. “I anticipate consolidating companies holding onto as much of their upside as possible as they benefit from operational efficiencies,” he suggests.

Despite higher development costs in the deeper pays, the Haynesville’s proximity to Gulf Coast LNG and industrial markets will continue to add to its attractiveness, DeLay holds.

“The Haynesville will be a large driver in domestic energy for the United States over the next five years and beyond,” he assesses. “We are seeing a drive across the country for the power baseload to meet more electricity demand from natural gas-fired plants. That will be very beneficial to dry gas plays, along with the continuation of the LNG export buildout along the Gulf. The Haynesville has so much potential.”

Lower Cotton Valley

Increasingly, the technological tools and techniques pioneered to develop unconventional reservoirs are being leveraged on conventional targets. One example is Empresa Operating, which is drilling tight sand sequences of the Lower Cotton Valley in northern Louisiana, where it has derisked 150 locations and is planning to drill 7-8 wells a year, explains Chief Executive Officer Dale Bowering.

So far, Empresa has drilled 20 horizontal wells on its position and completed them with high-volume hydraulic fractures in the Benton Field north of Shreveport. Historical vertical wells enabled acreage to be held by production, giving them time to apply unconventional approaches to traditional vertical pays not only in Benton but also in the future to Empresa’s acreage in the Rocky Mount, Longwood and Terryville fields.

Results in Benton include daily IPs of as much as 10 million cubic feet of gas and 1,000 barrels of oil from 7,000-foot laterals. The company’s position allows for longer laterals and several have been drilled to 9,000 feet, but Empresa’s operations team continues to examine whether longer is always better.

Empresa Operating is applying unconventional techniques to conventional tight sands in the Lower Cotton Valley in northern Louisiana, where it has derisked 150 locations and plans to annually drill seven or eight long-lateral horizontals that have average EURs and costs comparable to Permian Basin wells.

“If you examine the literature, there is a reasonable question about how much you gain by going farther out with longer laterals, including U-shaped wells,” Bowering says. “You definitely save in mobilization and drilling costs, but for us, the biggest issue, frankly, is greater operational risk for a small company like Empresa operating within cash flow.”

Historically in the Benton Field, operators would drill through the tight sands of the Lower Cotton Valley and hardly take notice, he recalls. As a result, there were few modern logs of the tight sand layers. After identifying the Benton field as a potential target, subsequent logs from Empresa’s horizontal wells yield far more detail on the thin, tight sands in the sequence.

“With modern logs, we can go do more detailed petrophysics and have more confidence of what areas have potential for stacked pay,” Bowering says.

Currently, Empresa’s wells produce a ratio of 55% gas-to-45% oil, and EURs are comparable to Permian wells, according to Bowering. Citing industry comparisons, Lower Cotton Valley wells in Bossier Parish have average EURs of 806,236 barrels of oil equivalent compared with Permian wells that can range from 500,000-1.2 million boe, depending on the area and lateral length, with newer wells’ averages often trending to the lower figure as the number of prime locations in the heavily developed Permian diminishes, he states, adding that wells in the two basins have comparable costs.

Empresa expects to resume its drilling program this summer after a pause so a midstream provider could replace an older section of pipeline damaged by a freezing early last year, although Empresa continues to sell production through a workaround.

The company is using the time to build cash, pay down debt, examine ways to reduce lease operating expenses, identify formations suitable for disposal, and connect its wells to saltwater disposal facilities. The effort saves the company about $1 a barrel at a time when improving drilling and stimulation costs are expected to bring down overall well expenses, Bowering concludes.