The most recent quarterly meeting of the Eagle Ford Shale Consortium was held March 27 in Cotulla at the A.B. Alexander Civic Center. Over 80 attendees consisting of elected officials, economic development directors, city managers, industry representatives and other stakeholders participated in the event.
Much has changed since the Eagle Ford first started producing crude oil and natural gas in significant quantities. The widespread use of unconventional extraction techniques in South Texas and other parts of the U.S. has significantly transformed local economies. Despite a slowdown beginning in 2015, the Eagle Ford still produces about a million barrels of oil, including an ultralight crude oil known as condensate. Natural gas production, though down from its peak of over 6 billion cubic feet per day (bcf/d), remains robust at nearly 5 bcf/d. Other shale fields in the U.S. continue to be prolific producers of both oil and natural gas as well.
The Marcellus Shale in the northeastern U.S., for example, produces around 24 bcf/d of natural gas — by far the largest natural gas field in the continental U.S. The Permian Basin produces nearly 2 million barrels of crude oil daily, and that number should continue to increase in coming years. By 2019, the U.S. will be producing record levels of oil, regularly exceeding the previous high of 10 million barrels per day (bpd) set in 1970. The U.S. already produces unrivaled levels of natural gas, clocking in now at nearly 30 trillion cubic feet annually, with data going back as far as 1900.
Participants at the event gathered to share their experiences over the years since 2011, when oil and gas production began in earnest. First up was a local economic development panel update, starting with Alfredo Gonzales, the general manager of the Holiday Inn Express. Cotulla now has over 20 hotels, up from just a handful a few years ago. Although one of the properties went bankrupt during the slowdown, it has recently reopened.
Other speakers included Cotulla ISD Superintendent Dr. Jack Seale, Bryan Daughtery with Carrizo Oil and Gas and Daniel Mendez, Chief for La Salle County Fire Rescue.
Larry Dovalina, City Manager of Cotulla (and former City Manager for Laredo), outlined progress that the city continues to make despite the ups and downs of the energy industry. While economic activity is below levels reached during the height of the boom, the muted activity is now being referred to as the “new normal.” For example, even though around 2.5 billion barrels of crude oil and condensate have been produced to date in the Eagle Ford, overall estimated recoverable oil and condensate is between 10-12 billion barrels.
Jesse Thompson with the Federal Reserve Bank of Dallas in the Houston branch provided a statewide outlook on economic activity across a variety of industries including energy, manufacturing and trade, real estate, as well as residual impacts from Hurricane Harvey to the Gulf Coast area.
The meeting concluded with an overview of UTSA Institute for Economic Development programs designed to assist the South Texas businesses in various capacities. The Southwest Trade Adjustment Assistance Center works with manufacturing and service companies impacted by foreign imports. The Minority Business Development Agency Advanced Manufacturing Center, funded by the U.S. Department of Commerce, provides counseling and technical assistance to ethnically-owned manufacturing businesses by implementing advanced technology applications. Other programs work with small business to help develop business plans, contracting opportunities and opportunities for export.
The next Eagle Ford Consortium quarterly meeting will be held in Pleasanton, also known as the birthplace of the cowboy. If you would like a copy of any of the presentations from the Cotulla event, please drop me a line at [email protected].
About the author: Thomas Tunstall, Ph.D., is the Senior Research Director at the University of Texas at San Antonio’s Institute for Economic Development, and was a principal investigator for numerous economic and community development studies. He has published peer-reviewed articles on shale oil and gas, and has written op-ed articles on the topic for the Wall Street Journal. Dr. Tunstall holds a doctorate degree in political economy, a master’s in business administration from The University of Texas at Dallas, and a bachelor of business administration from The University of Texas at Austin.