BHP will cut the number of drilling rigs running in the Fayetteville from 20 to about 8 or 9. The low price of natural gas is the leading reason. They intend to redeploy rigs and resources to "liquids rich" (oily) plays.
It looks like we are in a long term glut of natural gas despite the government restating the gas reserves in places like the Marcellus. Associated gas being produced from these "oily" plays like the Bakken and Eagle Ford are going to be a serious problem to the price of natural gas. The shale plays have been very successful but with this reduced drilling anticipate that the production will soon peak and start into decline which hopefully will help prices down the road. We need a market for the gas and that market should be for auto fuel.
T. Boone Pickens is working with Navistar to start the first generation natural gas trucks and the fueling stations will be created along the Interstate corridor. It is a start.
