Pioneer CEO says the natural gas company avoided a downturn in prices by shipping out to California
Windmills are bringing some of the cheapest electricity to the Permian Basin, pushing natural gas prices into the negative, Pioneer Natural Resources CEO Scott Sheffield told CNBC Thursday.
In order to address challenges in natural gas, Sheffield said the company will need to add as many as five additional natural gas lines to its operations in the southwestern basin.
Pioneer has about six crude oil lines that run from the Permian to the Gulf Coast, he said. The company only has one pipeline for natural gas there, he added.
“What’s gonna solve our natural gas industry is get more [liquefied natural gas] projects,” said Sheffield, who returned to lead the company after Tim Dove retired in February. “We need to ship it out, just like we are crude oil; just like we are propane, butane [and] ethane end products.”
Liquefied natural gas, or LNG, is natural gas that has been cooled for shipping and storage purposes.
Shares of Pioneer Natural Resources slipped nearly 1.5% Thursday. The stock price is up almost 10% in 2019, but down more than 26% in the past 12 months.