I'm not sure when it started in earnest, but the trend of independent producers dumping conventional natural gas assets is now firmly established.
At its investor day, EOG Resources
EOG was an early entrant in the North Dakota Bakken, and has more recently unlocked oily plays like the Barnett Combo and the Eagle Ford shale. In the latter play, the company estimates that it has total resource potential of 900 million barrels of oil equivalent. That's three times its estimated Bakken resource, and a pretty astonishing figure.
EOG's motivation to shift away from natural gas isn't hard to understand -- oil plays are a heck of a lot more profitable today. SandRidge Energy
Another leading independent, Canada's Talisman Energy
The shale gas boom, which has dovetailed so inconveniently with a major slump in industrial demand, has really made life difficult for natural gas-weighted producers. If the pricing chasm persists or widens further, I would expect to see increasingly silly transactions by E&Ps desperate to get more oil into their production mix. Do I hear $200,000 per flowing barrel? $250,000? Going once.. going twice.. sold to the man in the 10-gallon hat!
Fool contributor Toby Shute doesn't have a position in any company mentioned. Check out his CAPS profile or follow his articles using Twitter or RSS. The Fool owns shares of Chesapeake Energy. The Motley Fool has a disclosure policy.