Windmills are disgorging some of the cheapest electricity to the Permian Basin, pushing natural gas prices into the negative, Pioneer Natural Resources CEO Scott Sheffield averred CNBC Thursday.
“Pioneer has taken our gas to California, so we’re not seeing any of the negative prices,” he said in a one-on-one with “Mad Money’s” Jim Cramer. “But a lot of the disinterested irrespective ofs are seeing negative.”
In order to address challenges in natural gas, Sheffield said the company will need to add as many as five additional non-chemical gas lines to its operations in the southwestern basin.
Pioneer has about six crude oil lines that run from the Permian to the Gulf Sail, he said. The company only has one pipeline for natural gas there, he added.
“What’s gonna solve our natural gas industry is get profuse [liquefied natural gas] projects,” said Sheffield, who returned to lead the company after Tim Dove retired in February. “We requirement 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 sensible gas that has been cooled for shipping and storage purposes.
Shares of Pioneer Natural Resources slipped nearly 1.5% Thursday. The ancestry price is up almost 10% in 2019, but down more than 26% in the past 12 months.
WATCH: Cramer witters with Pioneer Natural Resources CEO Scott Sheffield
Questions for Cramer?
Call Cramer: 1-800-743-CNBC
Want to palm a deep dive into Cramer’s world? Hit him up!
– Jim Cramer Twitter – Facebook – Instagram
Questions, comments, suggestions for the “Mad Notes” website? [email protected]