Discussion: (18 comments)
Comments are closed.
A public policy blog from AEI
View related content: Carpe Diem
The Energy Information Administration released new US crude oil production data today for the month of February by state, and one of the highlights of the monthly update is that oil output in America’s No. 1 oil-producing state – Texas – continues its phenomenal, meteoric rise. Here are some details of oil output in “Saudi Texas”:
1. Texas produced an average of 2.295 million barrels per day (bpd) of crude oil in February, which is the highest average daily output in the state in any month since April 1986, just two months short of 27 years ago (see chart above).
2. Amazingly, oil production in the Lone Star State has more than doubled in less than three years, from 1.142 million bpd in July 2010 to 2.295 million bpd in February 2013, which has to be one of the most significant increases in oil output ever recorded in the history of the US over such a short period of time. A million bpd increase in oil output in less than three years in one state is remarkable, and would have never been possible without the revolutionary drilling techniques that just recently started accessing vast oceans of Texas shale oil.
3. In just the last 16 months since October 2011, when the state produced 1.598 million bpd, Texas oil output has increased by almost 700,000 bpd to 2.295 million bpd in February, which is the equivalent of adding an entire new oil field the size of the North Dakota Bakken formation to the US oil supply (based on February production in the Bakken of 715,000 bpd).
4. The exponential increase in Texas oil output over roughly the last three years has completely reversed the previous 23-year decline in the state’s oil production that took place from 1986 to 2009 (see chart).
5. In mid-2009, Texas was producing less than 20% of America’s domestic crude oil. The recent gusher of unconventional oil being produced in the Eagle Ford Shale and Permian Basin areas of Texas, thanks to breakthrough drilling technologies, has recently pushed the Lone Star State’s share of domestic crude oil above 30% in each of the last 11 months, and up to 32% of America’s crude in each of the last three months (December, January, and February).
6. Texas oil output in February, at an average of 2.295 million bpd, was 25.3% greater than the combined 1.83 million bpd of US oil imports that month from all of the Persian Gulf countries (Saudi Arabia, Iraq, Kuwait, and Qatar). In fact, Texas oil output has exceeded Persian Gulf imports in each of the last seven months starting last August, something that has never happened before in the history of monthly EIA data for Persian Gulf imports going back to January 1993.
7. Oil output has increased so significantly in Texas in recent years that if it was considered as a separate oil-producing country, Texas would have been the 13th largest oil-producing nation in the world for crude oil output in December (most recent month available for international oil production data). At the current rate of increase in crude oil output in Texas, the state is on track to possibly produce almost 3 million bpd by the end of this year, which could move the state all the way up to No. 8 in the world for oil output by December (depending on output changes in the other countries this year).
8. The exponential increase in Texas oil production is bringing jobs and economic prosperity to the state. For example, over the last 12 months through March, payrolls in the state of Texas increased by 329,500 jobs, which was a 3.1% annual increase in the state’s employment level, more than twice the national increase in payroll employment of only 1.40% over that period. Every business day over the last year, almost 1,500 new jobs were created in the Lone Star State, and many of those jobs were directly or indirectly related to the state’s booming oil and gas industry. Texas created 17% of US payroll jobs over the last year, even though the state represents only 8.2% of the US population.
MP: The exponential increase in Texas oil production over the last several years is nothing short of phenomenal, and is a direct result of “petropreneurs” who developed game-changing drilling technologies in America that have now revolutionized the nation’s production of shale oil. For Texas oil output to double in less than three years and completely reverse a multi-decade decline, and increase so dramatically that it’s the equivalent of adding a new Bakken oil field to America’s oil output, has to be one of the most remarkable energy success stories in US history.
Comments are closed.
1150 17th Street, N.W. Washington, D.C. 20036
© 2015 American Enterprise Institute for Public Policy Research