Associated Gas from the Permian and Maverick Basins as Viable, Affordable LNG Feedstock Is Highly Improbable.

Here's what Enverus Intelligence projects the American LNG industry will need in the way of natural gas over the coming years in different hubs in different locations along the Gulf Coast.

The Texas and Louisiana LNG industry is in the process of spending approximately $80 B to make these exports happen.

I'm speculating that most gas directed toward Louisiana will be from the Haynesville and ALL gas toward Texas will be associated gas from the Permian Basin tight oil play and the Eagle Ford dry gas leg including the big Chalk gas play in Webb County.

If you ask the computer about all this LNG stuff here are the answers you get:

From the Permian Basin and S.W. leg of the Eagle Ford play in the Maverick Basin, the LNG feedstock will require something like 8.5 BCFGPD of growth by 2031-2032. Associated gas and dry gas from the Delaware and Midland Basins in the Permian and dry gas from Maverick County has been growing annually at the rate of about 1.3 BCFGPD. That growth occurs AFTER approximately 9.5 BCFGPD is replaced each year from all three basins in the way of annualized decline. Essentially that means each and every year to meet Texas LNG feedstock demand Texas will have to find and put online over 10 BCF of new gas. Every year.

It cannot be achieved, nor can it be sustained.

I've shown you why in the Eagle Ford in the past and in the Permian here, very recently:

https://www.oilystuff.com/group/gassy-stuff/discussion/cec8799f-15fe-4d52-a32a-fce0613b676b

Future drilling locations geared for associated gas from tight oil wells in the Permian Basin is limited by the productive limits of each sub-basin, by the sheer number of existing wells that already exist in the cores of each sub-basin, and pressure depletion already underway.

Dry gas in high GOR areas of each sub-basin in the Permian is even more limited by Basin boundaries and very few gas prone benches in those high GOR areas.

To date the Permian HZ play has produced, sold and/or burned off approximately 43 TCF of gas in 15 years. That gas is gone. What pundits expect from the Permian, for LNG and AI data centers, will require another 70 TCF.

Both sources of natural gas, from each of the sub-basins in the Permian and in S.W. Texas is further limited by well economics. Associated gas from tight oil wells is a by-product of liquids production and no 0il and condensate wells costing $10MM each make money below $70 WTI NYMEX. Theses tight oil wells in the Permian historically have only 2.4 BCF of associated gas EUR.

So called "dry," high GOR gas from the western Delaware and the extreme S.E Midland Basins historically have only 5.3 BCF of associated gas EUR. I've shown you the realized production data on that as well as AI projected EURs. I urge you do the economics on wells like that using 60% of Houston Ship Channel NGI, or worse, WaHa NGI; those wells are NOT profitable to drill.

The financial condition of the Permian Basin tight oil sector has never been worse; it is $190B in debt, its finding and production costs are up 35% in the past 24 months and makes more produced water than it ever has in its existence...with no place to put it. It has completely used up the best of its drilling inventory and well productivity, oil AND associated gas, is declining.

The future of associated gas, from tight oil wells and dry gas wells in high GOR areas in the two Texas HZ plays will require tens of thousands of more expensive, unprofitable wells. Where they will drill them, and where they will find the money TO drill them, is a mystery.

LNG offers the same increase in market share that occurred in 2016 when the U.S. Congress lifted the ban on crude oil exports. With the lifting of the ban the Permian rig count exploded, and the sector borrowed $280 B it has yet to pay back. Some of this debt was paid down in 2022 and 2023 with higher production prices and "free" cash flow, then grew again in 2024 and 2025 with higher drilling and completion costs, higher interest rates and dividend and share buybacks.

I don't personally believe the tight oil sector will now be able to pay this debt down short of $135 oil prices, sustained, and even then, I have no idea WHERE it will drill the wells. It is also facing, at the very minimum, $23 B of plugging and decommissioning liability in the future.

LNG exports offer the same increase in market share that oil and condensate did in 2016. Will the tight oil sector do the same thing again, borrow the money to provide LNG feedstock?

And for what?

American natural gas needs to STAY in America, for Americans.