BAKU, Azerbaijan, March 7. The U.S. natural gas drilling sector has seen a significant decline in rig activity over the past two years, with a 32% drop in natural gas-directed rigs between December 2022 and December 2024, Trend reports.
According to the U.S. Energy Information Administration (EIA), the decrease, particularly in the Haynesville and Appalachia regions, coincides with record-low natural gas prices throughout 2024 and the increased use of advanced drilling technologies.
In the Haynesville region, which spans Texas and Louisiana, rig counts have fallen by 55% since December 2022 due to higher drilling costs and lower natural gas prices. As a result, marketed natural gas production in the region has decreased by 7%. Similarly, the Appalachia region has seen a 37% reduction in rig activity, limiting production growth to just 4% over the same period.
The decline in drilling is linked to the sharp drop in natural gas prices, with the U.S. benchmark Henry Hub price falling from a 14-year high of $6.95 per MMBtu in 2022 to $0.43 per MMBtu in 2024. This price reduction has made drilling less economical, particularly in higher-cost regions like Haynesville.