Posted on 03/19/2015 5:08:42 AM PDT by thackney
rowth in new U.S. oil production is slowing, though additional barrels continue to come onto the market, according to the latest index from the research and data firm Drillinginfo.
Drillinginfo’s latest index shows 794,000 new barrels of oil equivalent per day were reaching the U.S. market in February. That’s down 9 percent over the number of new barrels of oil equivalent added by U.S. producers in January.
Drilling permits across the U.S. were down 4 percent from January to February, to 3,101.
And the number of drilling rigs working continues to fall. But that number – 1,208 U.S. rigs in the field, down 4 percent in a week - is not entirely revealing.
Drillinginfo says that the dropping rig count is being “offset somewhat by an increase in well productivity and the number of wells spudded per rig.” So fewer, but better wells still equals more oil for now.
Karnes County at the heart of South Texas’ Eagle Ford Shale was the top area in the country for new oil production, adding 30,000 barrels per day of production in February.
In January, Karnes County had new production of 37,000 daily barrels of oil equivalent.
The other top areas that added new oil to the market in February were McKenzie County, North Dakota; Weld County, Colorado; DeWitt and La Salle counties in the Eagle Ford; Mountrail County, North Dakota; Dimmit and Gonzales counties in the Eagle Ford; Williams County, North Dakota and Midland County in the Permian Basin.
Karnes, DeWitt and Webb counties in South Texas were among the top 10 producers of new natural gas in February, according to the index.
The top new oil producers were EOG Resources, Chesapeake Energy, Anadarko Petroleum, Marathon Oil, BHP Billiton, ExxonMobil, ConocoPhillips, Encana Corp., Occidental Petroleum and Continental Resources.
Wouldn’t have anything to do with the union’s “safety” strikes at refineries? If production of petroleum products is down because of those strikes, if there is no place to put it, why pump it?
Is US Oil Production Finally About To Fall?
http://oilprice.com/Energy/Crude-Oil/Is-US-Oil-Production-Finally-About-To-Fall.html
18 March 2015
... An estimated 684 fewer rigs are in operation as of March 13 compared to a year ago. According to the latest government data, three of the most critical shale regions are expected to see production drops in April for the first time since October 2013. The Eagle Ford in South Texas, the Niobrara in Colorado, and the Bakken in North Dakota are expected to see their combined production fall by 24,000 barrels per day.
Despite the declines, other shale producing regions are expected to pick up the slack. The Permian basin in West Texas is projected to see more than a 21,000 barrel-per-day increase in April, offsetting the declines elsewhere. This means that overall U.S. output probably won’t drop off quite yet.
Nevertheless, the news that several of the most prolific shale basins are starting to see falls in output suggests that the U.S. may finally be approaching that inflection point. This development is crucial for oil markets, which have been waiting for a sign that U.S. shale would begin to cut back. Aside from falling rig counts, the Energy Information Administration also noted on March 17 that the decline rate for shale wells is increasing. Compared to conventional oil wells, shale drilling sees an initial burst of production only to quickly drop off after the first or second year. If the shale patch is starting to see decline rates tick up, production should soon decline much quicker, as there are fewer new wells being drilled to offset decline....
Understand that only one refinery was shut down due to the strikes, and it was half down before the strike for other work.
The other refineries continued to operate with non-union engineers, managers and contractors.
Owners of the wells that are on the drawing boards, but are on hold because of the collapsing price, are the fortunate ones. They aren’t selling their oil at cheap prices now, and when prices go back up, their wells will be drilled, and they’ll be getting more per barrel.
Also of note was the information released this week by Wood Mackenzie that as many as 3,000 wells have been drilled without being fracked. When prices do turn, that could become the lowest hanging fruit for new supply.
http://oilprice.com/Energy/Crude-Oil/Harold-Hamm-Dismisses-IEA-Shale-Prediction.html
A lot of these companies may not have the money to pay shut in cost.
A lot of times in the lease if the well is shut in the company still has to pay a certain amount to the mineral owners.
Some companies will also have to continue drilling because they have a performance clause in the lease.
Continue drilling or loose that part of the property which isn’t in a unit and producing.
If they don’t loose the lease before the price goes back up.
If the lease runs out before drilling operations start, then they have to renew the lease and pay the land owner again.
You mean supply and demand price signals work? Who’dathunkit!
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