The San Juan
Basin in northwestern New Mexico and southwestern Colorado, which mainly
produces natural gas, saw booms and busts in the 1950s, 1980s, and 1990s. By
2000, the basin was producing its peak at 4.5BCF per day, about 8% of U.S.
natural gas production at the time. Since then, however, as shown below, San
Juan Basin production has steadily dropped by more than half from that peak to
about 2 BCF/day. The graph shows basin production in the three counties that
make up nearly all of it, Rio Arriba and San Juan counties in New Mexico, and
La Plata County in Colorado.
The main reason for the drop
is that plays with better economics became available, especially as once
surging Fruitland Formation coalbed methane production dropped. Big players
like BP and ConocoPhillips left the basin for better plays like the Permian. The
stratigraphic section below shows some of the producing reservoirs.
Source: Wikipedia
RBN Energy reports that two operators in particular are poised to develop the Mancos Shale in the San Juan Basin, TXO Partners and Mach Natural Resources. TXO Partners, led by industry veteran Bob Simpson, reported in January 2025 that they think they can eventually produce up to 3 Tcf of gas in their 58,500-acre position in the basin from the Mancos Shale. They think that with modern technology, they can produce up to 25BCF per well in their core acreage position.
Mach Natural Resources,
led by another industry veteran, Tom Ward, recently entered the San Juan Basin
while looking to expand beyond the competitive Midcontinent region. RBN
describes Mach’s recent entry into the basin via acquisition:
“Mach Natural Resources also announced July 10 that it
had reached a deal to buy Sabinal Energy’s 130,000 net acres and 11 Mboe/d of
production (98% liquids and 2% gas) in the Permian for $500 million. The IKAV
and Sabinal deals diversify Mach’s holdings, which previously had been limited
to the Anadarko Basin. When the deals close, Mach’s production will total 152
Mboe/d, including 596 MMcf/d of gas (56% of it in the San Juan {about 334
MMCF/day or 17% of basin production} and almost all of the rest in the Anadarko),
30 Mb/d of crude oil and 22 Mb/d of NGLs.”
RBN also notes the
availability of pipeline takeaway capacity in the region, but also notes a
history of changing/reversing flows on those systems. San Juan gas mostly moves
north and west from the basin.
Seeking Alpha reports
that Mach is shifting to a focus on natural gas, up to 70% and over 50% of
company-wide revenue beginning in 2026, which the Mancos Shale can help to
provide. They plan to run three rigs in the San Juan basin in 2026, focusing on
Mancos gas.
According to Wikipedia:
“The San Juan Basin contains ample fuel resources,
including oil, gas, coal, and uranium. The basin has produced from over 300 oil
fields and nearly 40,000 wells, most of which are sourced from Cretaceous-aged
rocks. Furthermore, 90% of the wells have been drilled in the state of New
Mexico. As of 2009, cumulative production reached 42.6 trillion cubic feet of
gas and 381 million barrels of oil.”
The Wikipedia entry also
gives some history of oil and gas production in the basin:
In addition, there is some
production from Paleozoic reservoirs of Mississippian, Pennsylvanian, and
Permian age to the west in the Four Corners area.
The Lewis Shale in the basin,
which I once used as a correlate for a fractured siltstone play in Southern
West Virginia, is not very productive in the basin; it does produce significant
hydrocarbons in the Green River Basin to the north, into Wyoming. The Fruitland
coalbed methane play in the basin, unfortunately, has been associated with a
methane cloud that formed over the basin, mainly due to the de-watering of the
coalbed, which allowed large quantities of methane to escape into the
atmosphere.
The Mancos produces some oil
to the south, but the highest TOC rock is to the north in the gas window. A
2019 oral presentation given at the 2019 AAPG Rocky Mountain Section Meeting is
the source of the following graphics and abstract. The paper focused mainly on
oil production and thermal maturity in the southeastern part of the basin.
Production there resurged as horizontal drilling sought to tap oil, mainly from
2011-2015.
References:
The
Mancos Shale in the Southeastern San Juan Basin: A play limited by structure
and associated thermal maturity. Ron Broadhead. AAPG. Search and Discovery. Article
#11273 (2019), December 16, 2019. View PDF (searchanddiscovery.com)
I'm
Still Standing - The San Juan Basin Has Seen Many Ups and Downs. Is Another
Upturn Just Ahead? Housely Carr. RBN Energy. August 5, 2025. I'm
Still Standing - The San Juan Basin Has Seen Many Ups and Downs. Is Another
Upturn Just Ahead? | RBN Energy
Mach
Natural Resources outlines shift to 70% natural gas mix by 2026 while targeting
leverage reduction. Seeking Alpha. August 9, 2025. Mach
Natural Resources outlines shift to 70% natural gas mix by 2026 while targeting
leverage reduction
TXO
Partners, LP. Investor Presentation. August 2025. TXO+Investor+Presentation_8.4.25_vFinal.pdf
San
Juan Basin. Wikipedia. San
Juan Basin - Wikipedia
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