The Energy Information Administration (EIA) released new state crude oil production data this afternoon for the month of July, and one of the highlights of that 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” for July:
1. Texas produced an average of 2.625 million barrels per day (bpd) of crude oil in July, which is the highest average daily output in the state in any month since at least January 1981, when the EIA’s monthly data for state oil production begins (see chart above). Compared to a year earlier, oil output in Texas increased by 30.1% in July, posting the 22nd 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 almost doubled in only two years, from 1.44 million bpd in July 2011 to nearly 2.625 million bpd in July 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 1.2 million bdp increase in oil output in only two years 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 oil fields.
3. In just the last 18 months since February 2012 when the state produced 1.78 million bpd, Texas’s oil output has increased by 845,000 bpd to 2.625 million bpd in July, 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 July production in the Bakken of 810,795 bpd).
4. The exponential increase in Texas’s oil output over roughly the last three years has completely reversed the previous, gradual 28-year decline in the state’s oil production that took place from 1981 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 15 months, and all the way up to more than 35% of America’s crude output in July.
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 June at 2.575 million bpd (most recent month available for international oil production data) – just slightly behind No. 10 Kuwait at 2.65 million bpd.
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 July, payrolls in the state of Texas increased by 274,700 jobs, which was a 2.52% annual increase in the state’s employment level, compared to 1.65% increase in US payrolls over that period. Every business day over the last year, almost 1,000 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 experienced a 5.5% increase in payrolls over the most recent 12-month period through July.
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 America’s “petropreneurs” who developed game-changing drilling technologies that have now revolutionized the nation’s production of shale oil. For oil output in Texas to almost double in only two years, and increase so dramatically that the state produced 35% of all US crude oil in July, is undoubtedly one of the most remarkable energy success stories in US history – and it’s just getting started. At the current pace of annual increases of 30% or more, Texas oil production will likely surpass 3 million bpd by early 2014, and then surpass 4 million bpd by early 2015. Welcome to “Saudi Texas,” the shining star of The Great American Energy Boom.