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America’s Amazing Shale Revolution in one chart

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The chart above shows the combined daily oil output in America’s three most productive oil fields — the Bakken in North Dakota, the Eagle Ford Shale in south-central Texas and the Permian Basin in west Texas — from January 2007 to June 2014, based on estimates released this week by the EIA. From combined output of 1 million barrels of oil per day (bpd) in 2007, total crude oil production in those three oil fields will top 4 million barrels in June, based on drilling rigs data and EIA estimates of changes in production from existing wells.

Oil production for each of America’s three super-giant elite oil fields are displayed separately in the chart below, with June production levels estimated at 1.068 million bpd in the Bakken, 1.42 million bpd in the Eagle Ford Shale, and 1.53 million bpd in the Permian Basin.

oil1Amazingly, those three oil fields together as a separate country would have been the sixth largest oil-producer in the world last year with production of 3.62 million bpd, based on the EIA’s international oil production data for December 2013 (most recent month available), just slightly behind No. 5 Canada at 3.8 million bpd. With the ongoing, significant increases in shale oil production in those three oil fields, it’s possible that their combined production will match Canada’s later this year, and even approach oil output in China, which has been flat at about 4.2 million bpd for the last year.

MP: Thanks to the revolutionary drilling technologies of hydraulic fracturing and horizontal drilling, America’s petropreneurs have unlocked oceans of shale oil in Texas and North Dakota, which is reflected in the four-fold increase in the combined oil output of the Bakken, Eagle Ford Shale and Permian Basin oil fields between 2007 and 2014. That three million barrel per day increase in oil from just three US oil fields has to be one of the most remarkable energy success stories in American history. It’s a newfound shale bonanza that has brought unprecedented energy-based prosperity to America, in the form of millions of shovel-ready jobs throughout the economy, a huge boost in state tax revenues, millions of dollars in royalty payments to landowners and farmers, lower energy prices, and greater energy independence. “Saudi America’s” Amazing Shale Revolution, captured graphically above, has brought us from an era of “energy scarcity” and increasing reliance on foreign sources of oil, to a new era of energy abundance and increasing energy self-sufficiency.

Carpe oleum.

24 thoughts on “America’s Amazing Shale Revolution in one chart

    • Was this program made 10 years ago?

      Only truth to what the good economist was saying is this – if demand is greater than supply at a given price point the price will go up until supply and demand are in equilibrium.

      If this price is too high then, and only then, private people will start coming up with solutions to the problem – from finding alternate sources (gasoline or ethanol derived from Natural gas) to finding cost effective ways to use power more efficiently.

      If government gets involved – we will end up with suboptimal power sources (like wind and solar) and with inefficient ways to allegedly “save” energy (like electric cars and work at home jobs)

      • Hey, just putting up another perspective that was published last week. I agree with you, but you’ll find a lot of people who view shale as a very temporary bump in the road to running out of oil.

        • Depends on how you describe temporary. In Utah there is suspected 3 trillion barrels of shale oil. To put that in perspective, in the history of humankind we have only used 1.1 trillion barrels of oil.

        • Has a Malthusianist ever been right? They current belief it 2-3 hundred years of energy here. What was the state of humanity 2-3 hundred years ago? Could anyone of them have even came close to predicting what today looks like?

          We will never run out of oil, when it become cost restrictive to extract it, we will switch to other sources. There is no need to force the issue with wind and solar, when and if they become cost competitive, their “day in the sun” so to speak will occur naturally.

        • Coal can substituted for oil which can be substituted for gas which can be substituted for methane hydrates which can be substituted for methanol which can be substituted for synthetic hydrocarbons which can be substituted for coal.

          • The reason God created capitalism is precisely to solve problems like this. Marxists (who hate God except for those Marxists who believe they are god (which is almost all of them)) think that they need to solve these problems and then impose their supreme will on the ignorant masses. Not only that, non-Marxists are not allowed to introduce the total failure of Marxism into the debate.

      • God created capitalism? I did not know that. How will we break the news to Jesus who said “It is easier for a camel to pass through the eye of a needle than for a rich man to enter the Kingdom of Heaven”?

  1. The source is rt.com, i.e. Russian, which is a decidedly propagandistic outlet. Rather then looking at hydrocarbon resources in a balanced manner the slant is very much in favor of policies that would undercut the U.S. economy.

    Peak Oil is nonsense since it posits a future in which oil is the only energy source and that’s already, widely, untrue. Fission power production is a significant contributor to energy production currently and does anyone really think we’ve exhausted to possibilities of nuclear power?

    More importantly Peak Oil stands on two shaky legs.

    The first is M. King Hubbert and his prediction that U.S. oil production would peak in 1972 and lo! it did. The reason that’s a shaky foundation is that he made no other successful predictions. That makes M. King Hubbert 50% as worthwhile as a stopped clock which is right twice a day.

    The second is the profound seeming observation that the planet is finite and thus all resources extracted from the planet are finite.

    What’s never mentioned is how ridiculously inconsequential human impact on the planet actually is.

    Our grubbing of coal, oil and all other resources hardly makes a noticeable dent in the planet and were the resultant products not spread into a microscopically-thin layer on the surface of the planet also wouldn’t be noticeable. So while it’s technically true that resources are finite they’re so vast by comparison to human requirements that they might as well be infinite. We’ll never use them up.

    Of course that doesn’t serve the political agenda that society is in dire need of the wise guidance of the morally and intellectually superior so you won’t hear about that sort of thing from the likes of Erin Ade or most of the rest of media. Disaster sells and a lack of disaster doesn’t.

    • allen

      Peak Oil is nonsense since it posits a future in which oil is the only energy source and that’s already, widely, untrue. Fission power production is a significant contributor to energy production currently and does anyone really think we’ve exhausted to possibilities of nuclear power?

      No, peak *oil* is about *oil*. Period. No one questions the fact that there are, and there will be, other energy sources that will make oil irrelevant as an energy source in the future.

      The concept of Peak Oil is about oil *production rates*, not how much oil exists, or how much will be found in the future. In other words it’s not about “running out of oil”.

      The first is M. King Hubbert and his prediction that U.S. oil production would peak in 1972 and lo! it did. The reason that’s a shaky foundation is that he made no other successful predictions.

      You might want to refresh your understanding of what Hubbert’s theory of peak oil production actually is.

      You will find that, as theorized by Hubbert, most major oil fields in the world have followed a trend of increasing production, a peak, and then a lower production RATE. Everyone’s favorite example, as you pointed out, is US production which peaked in 1971.

      This says nothing about the *amount* of oil available, but only the rate at which it can be extracted.

      A crude analogy would be to imagine drinking a milk shake from a large sponge through straws. At some point, a peak will be reached at which a higher rate cannot be attained no matter how many straws are used, or how hard they are sucked on. It will just be necessary to wait for more liguid to flow to the ends of the straws.

      That says nothing about the size of the sponge or the total amount of milkshake available, and it says nothing about “running out of milkshake”, which of course is always a truly sad event.

      New technology allows the extraction of oil from shale and other non-conventional sources that weren’t previously exploitable. That means there’s a great deal more oil available for extraction – more and larger sponges – but those sponges allow much lower extraction rates than conventional sponges, and peak rates are reached much sooner than for conventional oil sources.

      To increase production *rates*, as is currently occurring in the US, requires a very high rate of new drilling and fracking as the “suck rate” for existing “straws” peaks and begins dropping much more quickly than it did for “conventional sponges”.

      The current debate about peak oil *rates* in the US, is whether the previous peak rate for conventional oil, reached in 1971, can be exceeded in the near future by non-conventional oil extraction *rates*.

    • Of course. There are about 10 years-worth of proven oil reserves at any given time because of the economics of oil exploration and production. There’s no point in exploring and test-drilling further out time-wise because the technology is continually improving. A 10-year cushion of known producible oil is sufficient. Unfortunately, alarmists unfamiliar with the exploration and production process, or harboring ulterior motives, have long equated “proven reserves” with “all there is”.

  2. It is quite possible it is just a flash in a pan. Given the things we already know about shale it is also quite probable we will see this expand and grow, though possibly California might need to come to quite a bit of unnecessary pain before that happens. Unnecessary pain as in self inflicted. Cut backs as severely as our administration seems to want us to cut back will cause quite a lot of pain and extensive death. I can see using care. I don’t want us to be stupid or fuelish in the way we use our resources. I also don’t want us refusing to use them unless we can be shown (by more than words) that there is a good reason for doing so.

  3. Here’s a question for you…What would happen if OPEC suddenly dropped their price of oil to $50 a barrel? I’m no expert but from what I’ve heard they could still make a nice profit at this price. Naturally, with all other oil being where it is, there is no reason to do this.

    But what if they did?

    • If the Saudi’s could force oil prices down temporarily to kill the competition they would have done it by now. I think they’re having difficulty maintaining production.

    • Roscoe

      Here’s a question for you…What would happen if OPEC suddenly dropped their price of oil to $50 a barrel? I’m no expert but from what I’ve heard they could still make a nice profit at this price.

      To what purpose? Why would OPEC want to do that?

      OPEC originally formed as a cartel to reduce oil production in order to raise world prices at a time when they were ridiculously low.

      • No idea why they would do that unless they wanted to wreak havoc. There are lots of interesting things that would happen. Imagine what it would do to Russia. Think what it would do to the gap in costs between fossil fuels and green fuels. Think what it would do to our oil industry which can only retrieve relatively expensive oil.

        As I mentioned originally, I have no idea why they would do it. It is probably in their best interests to make as much money off oil as they can while they can. Maybe, as George B says, they are having trouble maintaining production.

        I just thought it was an interesting question. All of our thinking along these lines has always been based on oil selling for the most it can sell for. I thought it would be fun to flip things around a little as an exercise and see if there were any interesting follow ups.

    • OPEC, basically Saudi Arabia, needs a NYMEX price greater than about $80/bbl to satisfy the demands of the population, Iran more than $100. That’s why the price will not drop much, yes, for the short term it could, but not likely. Also, please note that Saudi oil price manipulation was important in bringing down the old Soviet Union. One more point; peak whatever is typically based yesterday’s technology, not new ideas-which are impossible to forecast.

  4. I remember TheOilDrum, bunch of losers who were convinced, certain, the science was settled, oil was a thing of the past. At one point, back in ’09, it looked like Obama was gonna try and shut down fracking in ND. My favorite company in the region, Kodiak Oil & Gas, saw its shares drop to around $.25. (It’s now over $12).

    Ironically, fracking techniques have improved dramatically in recent years. The boom in ND is just beginning, even as Texas’ two fields are showing explosive growth. Way to go, doomsayers. Y’all made me money.

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