Tight oil driven production growth reduces need for US oil imports

In the US Energy Information Administration (EIA) Annual Energy Outlook 2014 reference case, crude oil production rises from 6.5 million bpd in 2012 to 9.6 million bpd before 2020. This is a production level not seen sine 1970.

Tight oil production growth accounts for 81% of the increase. In addition, its share of national crude oil production has grown from 35% in 2012 to 50% in 2019. In the high oil and gas case, US crude oil production reaches 11.3 million bpd in 2019 and 1.3 million bpd in the mid-2030s.

The high oil and gas resource case assumes improvements in tight oil production technology beyond those in the reference case, as well as higher well productivity rates.

Other high resource case assumptions include:

• Identification of additional tight oil resources.
• 50% higher estimated ultimate recover (EUR) for tight/shale oil and natural gas wells.
• 50% lower well spacing per acre for tight/shale oil and natural gas wells, with diminishing EUR for closely spaced wells.
• A 1% annual increase in the EURs for tight/shale oil and natural gas wells reflecting both abundant resources and technological advances.
• Additional resources in Alaska and Lower 48 offshore fields.

Reduced need for US imports

Under the reference case, the import share of US petroleum and other liquid fuels falls to approximately 25% in the last half of the current decade, before rising again to 32% by 2040. In the high oil and gas resource case net US imports continue to decline through the mid-2030s and remain at or near zero between 2035 and 2040.

Production gains

In the high oil and gas resource case, tight oil plays an every more significant role in driving national production growth, and accounts for approximately two thirds of total US production by 2035, versus less than half of total US production in the reference case.

According to the EIA, tight oil development is still at an early stage, and the outlook remains uncertain. The EIA predicts that there is more upside potential for greater gains in production than downside potential for lower production levels.

Adapted from a press release by Emma McAleavey.

Read the article online at: https://www.hydrocarbonengineering.com/gas-processing/08042014/tight_oil_driven_production_growth346/