Gulf Of Mexico Production and the EIA’s Prediction

The Bureau of Safety and Environmental Enforcement, BSEE, tracks all US Gulf of Mexico production. And here is what it looks like through May in kb/d. The huge spikes downward were hurricanes in the Gulf.

But the EIA is predicting an increase in GOM production. The chart below is actual crude only production as reported by the BSEE. The EIA data is crude + condensate from the EIA’s ANNUAL ENERGY OUTLOOK 2013. Obviously the EIA gets their data from the BSEE then adds the condensate to those numbers. The 2013 BSEE data is the actual average through May. The EIA 2013 data is their prediction through December. And of course this is annual data so the hurricane spikes are filtered out.

The EIA’s 2012 data is a little off also as this prediction was made sometime during 2012. But as you can see there is no way that their 2013 prediction can be correct. There are new GOM projects coming on line but there is also a far steeper decline in some of their current leases than they had anticipated.

The chart below is the combined production of four of the biggest producers in the GOM, Atlantis, Thunder Horse, Tahiti and Blind Faith in barrels per day.

Of the four, Blind Faith is the most consistent, in decline that is.

Just a few things of interest. Someone at the Wall Street Journal has finally gotten the message, that huge Saudi spare capacity is a myth.  The Mystery of Saudi’s Spare Oil Production Capacity.

“I don’t think Saudi Arabia can actually go much beyond the current level of 10.2 million barrels per day. Let’s say they can, they will be extracting very heavy crude which cannot fulfil shortages from African countries for instance,” said Kamel al-Harami, a Kuwait-based independent oil analyst. “Any new shortage in the market will have to be met by shale from the United States, and that’s why they were not that worried about the shortage in Libya last month because they know they can fill in the gap.”

Got that? Saudi is producing flat out and any new shortages will have to be met by shale oil from the United States. Wow! If they only knew.

And this from Bloomberg.

Russia plans to reduce crude shipments by 15 percent in the fourth quarter compared with this quarter, according to an Energy Ministry schedule obtained by Bloomberg News…

Exports of Russian crude will be 48.52 million tons, or about 3.87 million barrels a day in the last quarter of 2013. That compares with 57.27 million tons in the third quarter, according to a previous schedule.

One could expect  fluctuations in exports from time to time but 15%? And for a whole quarter? Is Putin getting reports about the decline in his old fields and starting to hoard oil? That could very well be the case.

Why Is Vladimir Putin Acting So Crazy?

Russia is still the world’s biggest overall energy exporter: It’s the No. 1 oil producer and No. 2 in gas after the U.S. However, the country’s known oil reserves—primarily between the Ural Mountains and the Central Siberian Plateau—are enough to sustain current production levels for just 20 years, according to a study in December by the European Bank for Reconstruction and Development (EBRD)

Putin’s aware of the problem.

Thanks to Jeffery Brown for alerting me to the Russian articles.

4 Comments on "Gulf Of Mexico Production and the EIA’s Prediction"

actioncjackson on Thu, 19th Sep 2013 10:35 pm 



In the second graph, why do they predict decline from 1.8 in 2016 to 1.4 in 2026 but then shows it leveling off here or even increasing slightly? Why would they think that it would level off starting 2026?

I’ll try to answer my question but someone please chime in. Possibly because of the time lag to bring new wells online coinciding with depletion of the dependable wells equating to a leveling off below the peak, instead of say predicting a steady decline.

BillT on Fri, 20th Sep 2013 1:08 am 



Action, the EIA is a government propaganda machine. Anything is possible in fantasy land. Few Americans will even read the articles, just the headlines. And fewer still will actually understand what they are reading or notice the contradictions. NO-ONE knows what 10 years will bring, except a decline in everything we consider necessary. NO-ONE.

actioncjackson on Fri, 20th Sep 2013 12:26 pm 



Thanks Bill, indeed you’re correct.

GregT on Fri, 20th Sep 2013 7:17 pm 



“The Bureau of Safety and Environmental Enforcement”????

WTF? I mean seriously, who makes this shit up?