New drilling expected in Fayetteville Shale play

Three new permits have been submitted for horizontal drilling in the once booming Fayetteville Shale play.

Flywheel Energy Development, an Oklahoma City-based private oil and gas exploration and production firm, filed applications last week to drill three new horizontal wells in Cleburne County. The company says it plans to drill five wells in 2025, although the remaining two have yet to be determined.

These are the first new wells drilled by any company in the Fayetteville Shale play since 2018.

“Flywheel Energy Development is excited to announce new applications for permits to drill three new Fayetteville shale wells,” said Flywheel CEO Justin Cope. “We look forward to testing enhanced drilling and completion techniques as it has been seven years since a new Fayetteville Shale well was drilled. If successful, and with necessary commodity price support, Flywheel hopes to unlock hundreds of new locations for future drilling.”

Flywheel’s total investment for the project will be $25 million to $30 million, the company said.

Formed in 2017, Flywheel Energy and its affiliates currently own and operate about 5,600 natural gas wells in the Fayetteville Shale with gross production of approximately 775 mmcf/day.

Since 2017, Flywheel and affiliates have made approximately $2.66 billion in acquisitions in the Fayetteville Shale, including the former positions of Southwestern Energy, Van Buren Energy (formerly XTO Energy positions), and most recently Razorback Production (formerly Merit Energy positions).

Additionally, Flywheel has invested roughly $315 million through various capital improvement projects. These strategic investments have placed Flywheel in a position to embark on the next phase of development with the five new wells planned for 2025, according to the company.

Before Flywheel’s acquisition in 2018, Southwestern Energy had been the top natural gas production company in the Fayetteville Shale for nearly two decades, pouring billions of dollars of capital investments into dozens of rural communities and counties across north-central Arkansas. At one point in early 2008, a study by the Sam M. Walton College of Business at the University of Arkansas said the shale play had created more than 11,000 jobs and had an overall economic impact nearing $20 billion.

However, low natural gas prices curtailed production in the region and brought new investment to a halt. In recent months, natural gas prices and futures have been trading higher. President Donald Trump’s new administration has promised a less restrictive regulatory environment for oil and gas drillers. On Feb. 14, Trump created a new energy council with the goals of increasing domestic oil and gas production, authorizing more exports of natural gas, and reviving a canceled natural gas pipeline project in the northeastern U.S.

The Henry Hub price for natural gas was $4.13 per million BTU in January, the highest January price since $4.38 in 2022. However, the January price is well below the $13.42 in October 2005 during the natural gas drilling boom that sparked initial activity in the Fayetteville Shale.

“We expect the spot price to rise through 2026, averaging almost $3.80/MMBtu in 2025, up 65 cents from our January 2025 Short-Term Energy Outlook, and reach nearly $4.20/MMBtu in 2026,” the U.S. Energy Information Administration noted in its Feb. 11 report.