After gas boom, Fort Worth forced to redefine its energy industry — and downtown

The rigs are mostly gone and neighborhood drilling controversies rear their ugly head with reduced frequency since the boom days. But the Barnett Shale is still here and continues to produce plenty of natural gas. 

At its peak in late 2011, natural gas production in the U.S. hit slightly above 5 billion cubic feet per day, according to the Energy Information Administration. Production has declined to slightly below 2 billion cubic feet per day currently. 

The production from the Barnett Shale and the accompanying technology helped make the U.S. self-sufficient in oil and gas for the first time since 1947, according to research from the Federal Reserve Bank of Dallas. Shale gas and its sibling, fracking, continue to be part of the political landscape, even becoming the subject of a question during the September debate between presidential candidates. While the neighborhood battles may have subsided, the energy industry — like the shale — remains, still producing natural gas and oil to pump it through its pipelines. 

In 2016, France-based energy company TotalEnergies purchased the remaining 75% of Barnett Shale assets from Chesapeake Energy after having purchased the original 25% in 2009. 

“Our company here, my part of it, focuses on natural gas,” said Dave Leopold, CEO of TotalEnergies E&P Barnett, which is the division of TotalEnergies focused on operations in the Barnett Shale. 

But TotalEnergies, which changed its name from Total in 2021 to better reflect its focus on other energy sources, has been making big investments in Texas beyond the Barnett, he said. 

“We have solar here in Texas and we just purchased a company that’s focusing on carbon capture,” he said. The overall company looks at and invests in various energy technologies from wind, solar oil, gas, blue energy and “anything that produces electricity,” Leopold said. 

TotalEnergies also supports the company’s efforts to reduce emissions at its drilling and production sites, Leopold said, though the company continues to face scrutiny about its practices from environmental advocates in Arlington and Fort Worth.

“We’ve done a ton of work and expense to reduce our emissions,” he said. “That comes from our home office in Paris, France. They’ve allowed the funding for that.” 

The company maintains one rig that they use for drilling operations in the Barnett Shale, Leopold said. 

Companies use old wells for new purpose 

Devon Energy, the company that purchased many of the original Barnett Shale assets from Mitchell Energy, sold its Barnett Shale assets in 2019 to focus on its oil reserves. The purchaser was Banpu Kalnin Ventures, based out of Thailand. Known in the U.S. as BKV Corp., the company has refracked many wells using more advanced technologies than those  originally used to unlock the natural gas trapped in the shale. 

Dallas-based EnLink Midstream acquired many of the natural gas pipelines in the Barnett Shale and also a natural gas processing plant in Bridgeport. In 2023, partnering with BKV Corp., EnLink drilled, completed and started up injection in what is said to be the first injection of carbon dioxide at a carbon capture and storage facility in Texas near the Bridgeport plant.

EnLink will transport natural gas produced by BKV in the Barnett Shale to its Bridgeport processing plant, where CO2 will be compressed and stored underground in a nearby well.

Carbon capture and storage, seen as a method to reduce carbon emissions and tax credits, was included in the federal Inflation Reduction Act for projects such as the one in Bridgeport. 

BKV said its second carbon project at Cotton Cove, also in Texas, is expected to begin operations by the end of this year. 

Exit of energy companies leads to opportunity for downtown developers 

After ExxonMobil purchased XTO Energy in 2010, the oil and gas giant maintained operations here for several years. But, in 2018, ExxonMobil announced it would move most of XTO Energy’s Fort Worth operations to a campus near Houston, costing the city 1,600 jobs and leaving a number of downtown buildings vacant. 

“When the XTO announcement was initially made, the general concern was oversupply within the downtown office market,” said Ryan Matthews, senior managing director at JLL. 

The buildings included some of Fort Worth’s top real estate in downtown. In addition, many of the buildings had historic value and had been meticulously restored by XTO Energy and its leader, Bob Simpson. XTO Energy’s headquarters building was in the historic W.T. Waggoner building at 810 Houston St. The 20-story structure was designed by Sanguinet & Staats and opened in 1920. It had fallen into disrepair until XTO Energy purchased it and converted it into its headquarters. 

San Francisco-based Kimpton Hotels and Restaurants opened a 232-room boutique hotel in the 24-story 714 Main Street building, while a Sandman Signature Hotel opened in the Waggoner Building. In January, that building was heavily damaged in an explosion that officials have linked to a natural gas leak. 

“The sale of these buildings ultimately provided a renaissance of sorts for the hospitality industry,” said Matthews. “Much-needed new hospitality inventory was added to Fort Worth, a market that has historically had a high barrier of entry for new development, while adaptive reuse projects increased the downtown commercial tax base.” 

As for Simpson, he started a new oil and gas company, TXO Partners, that operates in the Permian Basin and the San Juan Basin. The company, based in Fort Worth, went public in 2023. Simpson purchased the former Star-Telegram building and has restored and remodeled it to be the company’s headquarters. 

TCU adjusted strategy after energy jobs left Fort Worth

The halcyon days of the Barnett Shale had been good to TCU. The school formed the TCU Ralph Lowe Energy Institute to provide education and professional development opportunities for people in the energy industry. Along with that came plenty of donations, funding and support for the school, particularly in athletics, where TCU’s star continues to be on the rise. 

But as much of the energy industry’s attention has shifted to the Permian Basin, the energy institute has had to adjust. One way they adjusted was to offer more online classes, so people working in the Permian Basin, Houston and Oklahoma can continue their studies at TCU, said TotalEnergies’ Leopold, who is currently the chair of the advisory board for the institute. 

“The industry may have shifted where it is located, but the need for that talent pipeline is still there,” he said. “We’ve been able to use technology to help us bridge that.” 

The institute has also initiated a new energy business minor program where students in finance, accounting, marketing, management and other disciplines can get a background in the energy business, said Tom Seng, assistant professor of professional practice at the Energy Institute. 

“A year ago, we had 50 students in our energy minor and right now we have 75,” said Seng. “We’ve grown that and they get that background that can help them in their careers, if not immediately, later on.” 

Natural gas demand continues amid state, global growth

Natural gas will continue to fuel electricity generation for the foreseeable future, said Ray Perryman, president and CEO of The Perryman Group, a Waco-based economist. The Electric Reliability Council of Texas recorded an all-time high for winter natural gas-fired generation in January, and the summer record was established last year, he said. 

“With dramatic increases in power needs due to AI, crypto mining, and electrification, the challenge will only escalate,” Perryman said. 

National and global consumption of energy are similarly trending upward, and the development of the liquefied natural gas market has enabled the export of Texas-produced gas to countries around the world, Perryman said. 

“The Barnett Shale still has an important role to play in meeting the need for natural gas,” he said. 

Bob Francis is business editor for the Fort Worth Report. Contact him at bob.francis@fortworthreport.org.

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