08/04/2013 Mark J. Perry | AEI Ideas - The Energy Information Administration (EIA) released new US crude oil production data yesterday for the month of May by state, and one of the highlights of the monthly update is that oil output in America’s No. 1 oil-producing state – Texas – continues its phenomenal, meteoric rise. Here are some details of oil output in “Saudi Texas”: 1. Texas produced an average of 2.525 million barrels per day (bpd) of crude oil in May, which is the highest average daily output in the state in any month since April 1982, slightly more than 31 years ago (see chart above). Compared to a year earlier, oil output in Texas increased by almost 31% in May, posting the 20th straight month starting in October 2011 that the state’s oil output has increased by more than 30% on a year-over-year basis. 2. Amazingly, oil production in the Lone Star State has more than doubled in only 27 months, from 1.233 million bpd in February 2011 to 2.525 million bpd in May 2013, which has to be one of the most significant increases in oil output ever recorded in the history of the US over such a short period of time. A 1.29 million bdp increase in oil output in only 27 months in one US state is remarkable, and would have never been possible without the revolutionary drilling techniques that just recently started accessing vast oceans of Texas shale oil in the Eagle Ford Shale and Permian Basin fields. 3. In just the last 17 months, since January 2012 when the state produced 1.725 million bpd, Texas’s oil output has increased by 800,000 bpd to 2.525 million bpd in May, which is the equivalent to adding an entire new oil field greater than the size of the North Dakota Bakken formation to the US oil supply (based on May production in the Bakken of 745,000 bpd). 4. The exponential increase in Texas’s oil output over roughly the last three years has completely reversed the previous 27-year decline in the state’s oil production that took place from 1982 to 2009 (see arrows in chart). 5. In mid-2009, Texas was producing less than 20% of America’s domestic crude oil. The recent gusher of unconventional oil being produced in the Eagle Ford Shale and Permian Basin areas of Texas, thanks to breakthrough drilling technologies, has recently pushed the Lone Star State’s share of domestic crude oil above 30% in each of the last 13 months, and all the way up to 34.5% of America’s crude output in May. 6. Oil output has increased so significantly in Texas in recent years that if it was considered as a separate oil-producing country, Texas would have been the 11th largest oil-producing nation in the world for crude oil output in April (most recent month available for international oil production data) – just slightly behind No. 10 Mexico at 2.56 million bpd. At the current pace of output increases, Texas oil production will likely surpass 3 million bpd by the end of the year and surpass Kuwait, Mexico, UAE, and Iraq to move up to become the equivalent of the 8thlargest oil-producing “nation” in the world. 7. The exponential increase in Texas’s oil production is bringing jobs and economic prosperity to the state. For example, over the last 12 months through June, payrolls in the state of Texas increased by 303,000 jobs, which was a 2.8% annual increase in the state’s employment level, or close to twice the national increase in payroll employment of only 1.72% over that period. Every business day over the last year, almost 1,300 new jobs were created in the Lone Star State, and many of those jobs were directly or indirectly related to the state’s booming oil and gas industry, which saw a 3.65% increase in payrolls over the most recent 12-month period through June. MP: The exponential increase in Texas’s oil production over the last several years is nothing short of phenomenal, and is a direct result of “petropreneurs” like Texas oilman George Mitchell who developed game-changing drilling technologies in America that have now revolutionized the nation’s production of shale oil. For Texas oil output to double in only 27 months, and increase so dramatically that the state produced more than one of every three barrels of America’s crude oil output in May, has to be one of the most remarkable energy success stories in US history.
Posted on: Sun, 04 Aug 2013 20:21:35 +0000
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