Shale Means Texas-Sized Growth in U.S. Oil
The Energy Information Administration released a new report this week stating the United States had 29 billion barrels of “proved reserves” in 2011, a 15 percent increase from the 25 billion barrels in 2010. How significant is that? According to EIA, we haven’t seen oil reserves this high since 1985.
As you probably guessed, the sharp increase in oil reserves is directly related to advances in hydraulic fracturing and horizontal drilling. These technologies have allowed the United States to tap an abundance of resources deep underground, providing increased energy security, thousands of new jobs, and economic stability.
And that brings us to Texas, which continues to be the largest player in the field. According to EIA:
“Texas had the year’s largest volumetric increase in oil proved reserves (1,752 million barrels), driven largely by horizontal drilling and hydraulic fracturing activity in tight oil plays, petroleum-bearing formations of relatively low porosity and permeability.”
The increased oil reserves in 2011 were predominately found in the Eagle Ford and Permian Basin – both of whose continued significance is increasingly hard to deny. In fact, the EIA released 2013 production data for the month of May by state, and – not surprisingly – Texas continues to be the number one oil producing state in America.
But there’s more to the story than that. Mark Perry at the American Enterprise Institute points out that production in Texas “more than doubled in only 27 months.” Perry adds that the increase “has to be one of the most significant increases in oil output ever recorded in the history of the U.S. over such a short period of time.”
That’s right, folks. The largest oil producing state in America just doubled its oil production.
Given that there was a steady decline in Texas oil production from 1982 to 2009, the dramatic increase in the last three years is beyond impressive. Oil output has increased so rapidly in Texas in recent years that, if it were a separate country, Texas would have been the 11th largest oil-producing nation in the world in April.
As we continue to see across the United States, the shift in production techniques comes with countless, game-changing benefits for the nation. And, not for nothing, the Saudi Prince is absolutely terrified of what U.S. shale production could do to his country’s control of the global oil market.
Note to other OPEC members: Don’t mess with shale – especially in Texas.