The chart above helps to illustrate how significantly US oil production has been impacted by the revolutionary drilling technologies of hydraulic fracturing and horizontal drilling, which have unlocked a bonanza of shale oil in the states of Texas and North Dakota. A decade ago, the combined conventional crude oil production in the states of Texas and North Dakota was only 1.165 million barrels per day (bpd), and represented less than 21% of total US crude oil output (EIA data here). By 2008, in the very early days of the US shale oil revolution, the newly tapped oil from deep shale rock formations in Texas and North Dakota started increasing oil production in those two states, but their combined production of 1.28 million bpd represented less than one-quarter of total US crude oil production.
In 2011, the combined crude oil output in the two states increased to almost 1.9 million bpd, and Texas and North Dakota together were producing one-third of all US crude oil. And then over just the last several years, as the new advanced technologies were perfected and started accessing oceans of shale oil in the Lone Star State and the Peace Garden State, combined oil production in those states doubled from an average of 1.9 million bpd in 2011 to more than 4 million bpd in April of this year, the most recent month available. In each of the last months over the last two years, those two states have produced more than 40% of all US crude oil, and in eight out of the last nine months, their combined share exceeded 47% of all US oil. The share of all US oil pumped from Texas and North Dakota exceeded 48% in both February and March of this year, and the ongoing shale oil booms in both states will likely push their combined share of all US oil above 50% sometime later this year.
To help put the oil production in Texas and North Dakota into perspective, consider that their combined output has exceeded Canada’s total oil production in every month since last July. Further, in February of this year (most recent month for international oil production statistics), the combined oil output of 3.865 million bpd for North Dakota and Texas would have placed them as the world’s fifth largest oil-producer, just behind No. 4 China at 4.2 million bpd and ahead of No. 6 Canada at 3.5 million bpd.
The phenomenal rise in shale oil production in Texas and North Dakota, especially the eye-popping increase from less than 2 million bpd in 2011 (for the two states combined) to more than 4 million bpd in April of this year, has to be one of the most remarkable energy success stories in US history, and maybe in all of world history. The increase of more than 2 million bpd of US oil from just two states over the last several years is the equivalent of adding almost the entire crude oil production of Venezuela (2.3 million bpd) to America’s oil supply.
Along with the new gushers of shale oil in Texas, North Dakota and other US states, and new gushers of shale gas from states like Pennsylvania has come a gusher of new, shovel-ready jobs in the oil and gas business. Direct jobs in oil and gas extraction activities have increased by 76% in the last decade, and indirect jobs in support activities for oil and gas operations have increased by 148% over that period. In recent years, very few other sectors have added as many jobs for American workers (especially when considering the direct, support, and indirect jobs throughout the energy industry’s long supply chain) or made as much of an overall economic contribution to the US economy as the oil and gas industry. ‘Saudi Dakota’ and ‘Saudi Texas’ are at the center of that energy-driven, job-creating, prosperity-generating economic stimulus and they continue to be the shining stars of the Great American Energy Boom.
As David Blackmon wrote in Forbes last week (“TX/ND/PA: The U.S. Axis Of Energy Independence“):
As we prepare to celebrate our nation’s Declaration of Independence, it would also be appropriate to take a moment to celebrate those states who are currently leading our nation down the path towards energy independence. No issue facing America today is more important than where we will continue to access sources of abundant and affordable energy. In the U.S. today, many states are playing increasing roles in this drive towards energy independence, but three of those states are clearly leading the way: Texas, Pennsylvania and North Dakota.
A reason to celebrate this 4th of July is that these three great states form the axis of real leadership that is marching our country towards its Declaration of Energy Independence. God Bless Texas, North Dakota and Pennsylvania, and God Bless America this July 4.