Hydraulic fracturing and horizontal drilling are the twin tanks of the shale revolution and it’s not just about gas; it’s about crude oil and security, too.
Yesterday’s Today In Energy post at the Energy Information Administration (EIA) site tells so much about the beauty and extent of the shale revolution. The combination of hydraulic fracturing with horizontal drilling hasn’t just made the U.S. the leader in natural gas production that it now is, but has also made our nation far more energy secure in terms of crude oil as well. Hydraulic fracturing in tandem with horizontal drilling is a the kind of invention that historians will write about in the same way they once wrote about Eli Whitney’s cotton gin and Robert Fulton’s steamboat. We might well ask, in fact, what it can’t do for our energy security.
Yes, the same hydraulic fracturing and horizontal drilling techniques that created a whole new natural gas industry in the U.S. have also created a shale revolution on the oil side, as this chart so vividly illustrates:
Just look at what happened. According to EIA (emphasis added):
Annual average U.S. crude oil production reached 9.3 million barrels per day (b/d) in 2017, an increase of 464,000 b/d from 2016 levels after declining by 551,000 b/d in 2016. In November 2017, monthly U.S. crude oil production reached 10.07 million b/d, the highest monthly level of crude oil production in U.S. history. U.S. crude oil production has increased significantly over the past 10 years, driven mainly by production from tight rock formations using horizontal drilling and hydraulic fracturing. EIA projects that U.S. crude oil production will continue to grow in 2018 and 2019, averaging 10.7 million b/d and 11.3 million b/d, respectively.
And, here’s where it all happened on the crude oil side:
Although much has changed since 1970, Texas continues to produce more crude oil than any other state or region of the United States. Texas has held the top position in nearly every year since 1970, with the exceptions of 1988, when Alaska produced more crude oil than Texas, and from 1999 through 2011, when production from the Federal Gulf of Mexico was higher.
Texas crude oil production averaged 3.5 million b/d in 2017 and reached a record high monthly level of 3.95 million b/d in December 2017. Texas’s 2017 annual production increase of nearly 300,000 b/d—driven by significant growth within the Permian region—was more than all other states and the Federal Gulf of Mexico combined.
Growth in the Permian region, which spans parts of Texas and New Mexico, also contributed to a 74,000 b/d production increase in New Mexico, the state with the second-largest growth in 2017. New Mexico surpassed California and Alaska to become the third-largest crude oil-producing state in the second half of 2017, although it produced less than those states on an annual average basis.
The EIA offers one more revealing chart, showing where the greatest change occurred between 2016 and 2017:
The stunning growth in New Mexico is a real eye-opener, but so is what’s happening in Oklahoma, Colorado, North Dakota and, of course, Texas. Hydraulic fracturing has made something no one dreamed was even possible a decade ago a new reality; an America that is not just energy secure, but also energy dominate. “Production levels in Colorado, Oklahoma, and North Dakota,” in fact, “each grew by more than 30,000 b/d from 2016 to 2017,” according to EIA.
It doesn’t get any better. The shale revolution is real, it’s overwhelming and it’s making us all a lot more energy secure in a world where everyone else would love to take advantage of us.
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