The Energy Information Administration (EIA) recently released its ‘US Crude Oil and Natural Gas Proved Reserves Report’ showing that oil and natural gas proved reserves continue to increase. US crude oil and lease condensate proved reserves increased by 9% to 39.9 billion bbls in 2014, and natural gas proved reserves increased by 10% to 389 trillion ft3. Crude oil and lease condensate proved reserves are now at the highest level since 1972 and natural gas proved reserves are the highest ever.
Proved reserves of oil and natural gas are volumes that geologic and engineering data demonstrate, with reasonable certainty, to be recoverable under existing economic and operating conditions. As proved reserves depend on economic factors, they can increase and decrease as prices and extraction costs change. Proved reserves are developed from technically recoverable resources, of which the US has an immense amount. According to the IER report, the US has recoverable oil resources that are 36 times larger than its proved oil reserves and recoverable natural gas resources that are seven times larger than its proved natural gas reserves for 2014.
Texas had the largest increase in proved reserves of crude oil and lease condensate, 2054 million bbls, representing 60% of the nation’s total net increase in 2014, coming mainly from tight oil plays (e.g., Wolfcamp, Bone Spring) in the Permian Basin and the Eagle Ford Shale play. North Dakota had the second largest increase, 362 million bbls, representing 11% of the nation’s net increase in 2014, mostly from the Bakken tight oil play in the Williston Basin. These two states are the largest crude oil and lease condensate reserve and production states in the nation. New Mexico had the third largest increase in crude oil and lease condensate proved reserves in 2014, benefitting from the same Permian Basin developments as Texas. Colorado had the fourth largest increase in crude oil and lease condensate reserves in 2014, from the Niobrara/Codell tight oil play in the Denver Basin.
Tight oil plays, mostly from shale formations, accounted for 33% of all the crude oil and lease condensate proved reserves. Most (95%) US tight oil proved reserves in 2014 came from six tight oil plays. The Bakken/Three Forks play in the Williston Basin retained its rank as the largest tight oil play in the US in 2014, followed by the Eagle Ford.
Proved natural gas reserves increased in four of the top five US gas reserves states, Texas, Pennsylvania, Oklahoma, and West Virginia, in 2014. Pennsylvania, had the largest net increase in natural gas proved reserves (10.4 trillion ft3) in 2014, but remained the second largest state in natural gas reserves, second to Texas. Texas added the second highest volume of natural gas proved reserves (8.0 trillion ft3) in 2014, followed by West Virginia (7.9 trillion ft3) then Oklahoma (5.4 trillion ft3).
Ohio added almost 4 trillion ft3 of natural gas proved reserves in 2014, more than doubling its natural gas proved reserves. Ohio approved 2087 Utica shale permits, of which, 1648 Utica wells have been drilled and 1119 Utica wells are producing. According to the state, natural gas production increased by 126%, from 287 billion ft3 of natural gas for the first nine months in 2014 to 651 billion ft3 for the first nine months of 2015.
West Virginia added enough Marcellus natural gas proved reserves to surpass Wyoming and Colorado to become the fourth largest natural gas reserves state, ranking behind Oklahoma. Idaho reported proved natural gas reserves for the first time in 2014.
Natural gas reserves in shale plays contributed more than half to total natural gas proved reserves in 2014. Proved reserves of shale natural gas increased from 159.1 trillion ft3 in 2013 to 199.7 trillion ft3 in 2014 (an increase of 40.6 trillion ft3), 25% higher than in 2013. The share of shale gas compared with total natural gas proved reserves increased from 45% in 2013 to 51% in 2014.
Proved reserves of oil and natural gas are ever increasing in the US, mainly due to the shale revolution that allows oil companies to produce oil and natural gas from shale formations economically using hydraulic fracturing and horizontal drilling technology. Proved natural gas reserves from shale formations now constitute over half of all the proved natural gas reserves in the US and proved oil reserves from tight oil formations, mainly shale plays, constitute a third of the proved oil reserves in 2014. While natural gas reserves reached another record in 2014 and oil reserves were the highest since 1972, the technically recoverable resources from which they came are enormous and will continue to supply proved reserves for Americans for decades to come.
Adapted from press release by
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