October 22, 2008
They said, “the Barnett-Shale is going to produce jobs for years to come.”
They said, “the Barnett-Shale is going to open new avenues for natural gas production.”
They were wrong. Well. Not totally wrong. But close. It is very true that the Barnett-Shale is the largest natural gas find in North American history. It is true it has produced many jobs that simply did not exist. And it is true, it is certainly making somebody very, very rich.
But this week, things started turning around. With Wall Street tanking and the price for a barrel of oil dropping to the lowest rate in more than 18 months, these hot-to-trot gas exploration companies have put a dead halt on their spending. So much so, that some of those prized jobs are no longer available. If you haven’t already signed a gas lease, you’re out of luck. Those have dried up, too. In fact, a local prime-time news anchor left his cushy TV chair to represent one of these gas companies, only to get laid off and never see his new role come to fruition. This same company is not offering any new leases, and they are letting workers go.
Yes, business is still booming, but only on those leases and sites that are already established are the ones reaping the rewards.
What’s my point? I have a few.
First… you knew it was too good to be true. And sadly, this boom in comparison was very short lived.
Next, I really don’t feel sorry for those people who waited too long to sign on. If I’m not mistaken this may very well be a blessing in disguise for them. Yeah. Some are losing significant dollars, but what they don’t realize is the impact that all this drilling is going to have on the earth and their properties.
I think these companies have railroaded their way in and now are having to back-peddle to get out of promises they’ve made. We’ve already seen one city go toe-to-toe with one gas company as a result of pulling out of a lease. The loss of the lease in effect is taking nearly $750,000 out of the city’s pocket. However to that I would say, “Don’t count your chickens before they hatch.”
It’s an ugly business this natural gas drilling beast. I do giggle a little at their current plight. It will truly be interesting to see, is this a boom or bust?