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POLITICS: PennAve

Higher oil, gas output caused by more efficient wells, Energy report says

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American Petroleum Institute,PennAve,Energy and Environment,Fracking,Zack Colman,Oil

More efficient and productive wells were largely responsible for an uptick in U.S. oil and gas output this year, the Energy Department’s statistics arm said in a report released Tuesday.

That means drillers are getting more out of new wells rather than boosting production by adding more rigs, the Energy Information Administration said.

“Increases in drilling efficiency and new well productivity, rather than an increase in the number of active rigs, have been the main drivers of recent growth in domestic oil and natural gas production,” the EIA said.

Much of that production bump comes from hydraulic fracturing, or fracking, a drilling method that involves injecting a high-pressure cocktail of water, sand and chemicals into tight rock formations to tap hydrocarbons buried deep underground.

Oil production at the Bakken shale formation in North Dakota and Montana grew the fastest in the past month, rising by 26,000 barrels per day — good for a 2.8 percent increase. The Eagle Ford shale formation in southern Texas followed by pumping out 24,000 more barrels — a 2.2 percent jump, the EIA said.

Overall, Eagle Ford oil output hit roughly 1.1 million barrels per day this year, while Bakken production settled just under 1 million barrels per day.

For natural gas, the Marcellus shale formation that stretches from New York to West Virginia easily bested other regions by pumping out about 12 billion cubic feet per day.

The data is part of a new monthly “drilling productivity report” published by the EIA, which will monitor the output of new and old wells in regions with heavy fracking activity.

The practice has helped create a boom in U.S. energy production, but has prompted pollution concerns from environmental and public health groups.

The Obama administration has issued a draft rule governing the practice on federal lands, though an overwhelming majority of the nation’s shale plays are in private or state hands. Many states already have regulations for the practice, while others are studying the method.

Fracking opponents want drillers to disclose the chemicals using during the process and to strengthen structural requirements for wells. They worry about fracking’s potential to contaminate groundwater and its impact on greenhouse gas emissions through methane that escapes during the process.

But industry supporters say the method is safe, saying the claims of drinking water contamination and methane leakage are overblown.

Kyle Isakower, vice president for policy and economic analysis with the American Petroleum Institute, said the EIA data showed more efficient fracking wells leave a “smaller environmental footprint” than older extraction methods.

“The U.S. energy revolution has been the result of tremendous technological progress in merging techniques like hydraulic fracturing and horizontal drilling,” he said.

While fracking has been a boon for the energy industry, other types of drilling have fallen by the wayside, the EIA report showed.

Production from legacy wells dipped significantly this year, as all six shale formations studied posted a decline in both oil and gas production from old wells. Still, the increase in production from new wells was large enough to generate net gains.

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