After a down year, the Haynesville is ready for a turnaround. East Daley expects production to climb through 2025 in a tighter gas market, and finding early support for this view from DT Midstream’s (DTM) Louisiana assets.
Haynesville gas production declined from 16.1 Bcf/d in 1Q24 to just 14.5 Bcf/d in 4Q24, according to East Daley Analytics’ ArkLaTex Basin forecast, dragged lower by weak gas prices, steep rig cuts and deferred well completions. However, in the Macro Supply & Demand Report, EDA expects that trend to reverse in 2025 and 2026 as growing demand for LNG exports supports higher prices. We recently made the case for more Haynesville drilling this year, even though producers are hesitant now to commit more capital, and expect deferred completions and shut-in production to return with better prices.
Volumes on DTM’s Louisiana Energy Access Pipeline (LEAP) show early signs of this recovery, ticking up in Feb ’25 after a down 4Q24. The interstate pipe samples for LEAP (shown in dark blue in the figure) averaged over 1 Bcf/d in February, the first 1+ Bcf/d month since May ’24. At the end of February, the samples passed 1.2 Bcf/d for the first time since March ’24.
We estimate that volumes on LEAP are actually ~300 MMcf/d higher than the pipe samples indicate due to LEAP’s interconnect with TC Energy’s (TRP) intrastate pipeline at Gillis, LA (see orange shaded area of figure). TRP started the 1.5 Bcf/d Gillis Access project in March ’24, and shortly afterward saw an influx of volumes from LEAP that had previously supplied the Texas Eastern pipeline system. LEAP has a 1.0 Bcf/d interconnect with Gillis Access and is currently the only supplier to the pipe.
Currently, Gillis Access ships volumes from LEAP over to TRP’s other Louisiana interstate systems, mostly to ANR Pipeline, but the line also connects with Columbia Gulf. We expect this supply chain eventually will allow Plaquemines LNG to source Haynesville gas from DTM via Columbia Gulf’s East Lateral Xpress expansion. – Oren Pilant Tickers: DTM, TRP.
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