New projections show oil production soaring as rigs boost efficiency
Posted on May 12, 2014 at 6:48 pm by Simone Sebastian
HOUSTON — Oil production will continue to soar in the six major U.S. shale plays, with more barrels pumped per rig, according to federal projections released Monday.
Total oil production in the six regions is expected to grow to 4.43 million barrels per day in June, an increase of 75,000 barrels per day compared to May, according to the U.S. Energy Information Administration. The federal agency expects oil rigs will produce an average of 271 barrels per day each, an increase of one barrel over May.
The projection reflects the growing efficiency of rigs since the U.S. energy boom began. In June 2007, each rig produced an average of just 116 barrels per day in the most efficient region, the Bakken Shale.
The United States is home to more than half of the world’s approximately 3,400 operating rigs, though rig counts have declined or stagnated in many of the major drilling regions amid improved efficiency.
The six shale regions analyzed account for 95 percent of the oil production growth in the United States: the Eagle Ford in South Texas, the Permian in West Texas and New Mexico, the Bakken in North Dakota and Montana, the Haynesville in Louisiana and East Texas, the Marcellus in the Northeast, and the Niobrara largely in Colorado.
Eagle Ford Shale
The largest share of the oil production growth in June will occur in the Eagle Ford Shale. The South Texas region is expected to produce 1.4 million barrels per day, an increase of 27,000 barrels over May’s rate. The region also will add 6 rigs to its fleet of 470 currently, according to the EIA projections.
In the Eagle Ford , oil production per rig for new wells will grow from 470 barrels per day in May to 476 barrels per day in June.
By comparison, oil rigs in the region produced just 36 barrels per day each in June 2007.
Oil rigs in the Permian Basin in West Texas are projected to produce 132 barrels per day each in June, an increase of two barrels over May’s rate. In the Bakken, home to the greatest rig efficiency, average production is expected to rise from 498 barrels per day in May to 505 barrels per day in June.
Rapid well declines
However, while each rig is bringing more new oil production on line, the rate of well production decline also has accelerated, according to the EIA data.
In May, oil production from existing Eagle Ford wells dropped by 107,987 barrels per day — the most rapid decline among the six analyzed regions. By comparison, production for all existing Eagle Ford wells in May 2007 declined by just 1,802 barrels per day.
The Bakken was home to the second largest decline. Existing wells there produced 69,035 fewer barrels per day in May than in April, according to the EIA.
Still, the energy boom will ensure that net production continues to move in a positive direction. While existing Eagle Ford wells will produce 110,738 fewer barrels per day in June, the new wells will pump 137,000 more barrels, for a net increase of about 26,000 barrels in the South Texas region.
The trend toward more efficient rigs also is evident in the nation’s most prolific natural gas fields.
Total natural gas production in the six regions — home to all of the nation’s natural gas growth — is expected to grow to 39.3 billion cubic feet per day in June, an increase of 480 million cubic feet per day compared to May. In the nation’s largest natural gas region, the Marcellus Shale, each rig produced an average of 6.48 million cubic feet per day in May, an increase of 40,000 cubic feet per day compared to April.
In the Haynesville Shale, each rig produced an average of 5.23 million cubic feet per day in May, compared to an increase of 80,000 cubic feet per day compared to April.
In the early days of the shale gas boom, each rig produced about 461,000 cubic feet per day in the Marcellus and about 1 million cubic feet per day in the Haynesville.
More Articles about our Industry
Posted on May 12, 2014 at 6:48 pm by Simone Sebastian HOUSTON — Oil production will continue to soar in the…Read More
Posted on June 25th 2014 - The news coming from Iraq points to an inevitable civil war between the Shiites and…Read More
The football season is right around the corner with a biggie coming up this Saturday. Oklahoma St is playing the…Read More