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Page added on July 28, 2011
US oil production gains change the energy landscape
The Independent Petroleum Association of America has called attention to a stealthy trend changing the energy landscape: US production of crude oil and gas liquids is increasing.
Not many years ago, US production was thought to have entered a period of perpetual decline. Even fewer years ago, the assumption was that the only producing region able to yield increases was the Outer Continental Shelf.
Events have scuttled those expectations.
IPAA points out that between the first quarter of 2008 and first quarter of 2011, US output of crude oil and gas-plant liquids increased by slightly more than 500,000 b/d.
Last year, total average crude and liquids production was 7.5 million b/d. While that’s still well below historic highs of the 1970s, the gain looks much different from the pessimistic projections of yesteryear. Combined with a sag in demand, it helped lower oil imports between 2008 and 2010 by 1.7 million b/d.
Geography of the production increase also contrasts sharply with former expectations.
Onshore Lower 48 crude production rose by 340,000 b/d between the first quarter of 2008 and same quarter this year. Its trend is upward. Offshore Lower 48 output rose by 260,000 b/d over the period, but the trend is slightly downward.
Onshore production has received new life from shale plays. Offshore production has been slowed by regulatory and permitting brakes applied after the Macondo blowout and spill last year.
Also between first-quarter 2008 and 2011, production of gas-plant liquids increased by 200,000 b/d to more than 2 million b/d.
Further gains are likely—or at least possible—from all three sources as shale plays expand, gas production rises to supply new and expanding markets, and offshore work recovers.
Oil production has entered a new era in the US.
A large question now is whether a hostile political climate, with its persistent threat of preferential taxation of producers and restrictions on essential well-completion methods, will keep the country from enjoying the benefits.
7 Comments on "US oil production gains change the energy landscape"
SilentRunning on Fri, 29th Jul 2011 4:59 am
Wake me up when the peak of 1970 is exceeded.
Yes, some new (expensive) methods are temporarily reviving old fields that were previously too far gone to be worth pumping.
But will it continue forever? No – it can’t. Oil is a finite resource. Also, the laws of thermodynamics continue to hold sway.
BillT on Fri, 29th Jul 2011 7:13 am
EROEI = proof that the age of petroleum will end in the not too distant future. And, yes, billions, maybe trillions of barrels of some form of oil will still be in the ground, and there they will stay.
cusano on Fri, 29th Jul 2011 12:15 pm
BillT is correct. It really comes down to the costs of getting it to the consumer. At $8, $9, or $10 per gallon at the pump..our economy will be in shambles. We may as well ‘find’ a hugh reservoir of oil on the moon. Yup, we could brag that up too, but what good would it do us?
Rick on Fri, 29th Jul 2011 2:57 pm
The increases are too small to make any dent. This article is all smoke and mirrors.
BillT on Fri, 29th Jul 2011 3:18 pm
I might add that oil sands (tar sands) already are bumping the limits of recovery. If I remember correctly, it take 2 barrels of oil to get 3 barrels out and in the pipeline for a net of 1 barrel. To get those 3 barrels of oil, it takes 21 barrels of water. THERE is your limiting factor. There is not enough water in the country to get millions of barrels every day.
KingM on Fri, 29th Jul 2011 3:45 pm
BillT – try to think before you post. Look up the average flow of the Athabasca river, divide it by 21 and tell me if water is the limiting factor.
I get 16 million barrels per day from that single river. Water is not the limiting factor.
Geos on Sat, 30th Jul 2011 1:23 am
Cancer is the limiting factor. How much are we willing to turn pristine rivers into toxic, fetid sewers like they have in China? How many cancers = 1bbl of oil?