US shale production to rise to highest in April

US shale crude oil production in the seven biggest shale basins is expected to rise in April to its highest since December 2019, the Energy Information Administration said on Monday.

Shale production is expected to rise by 68,000 barrels per day - the slimmest rise since December 2022 - to 9.21 million bpd, the EIA data showed.

Crude output in the Permian basin in Texas and New Mexico, the biggest US shale oil basin, is expected to rise to 5.62 million bpd. Though that would be a record high, oil output from the region is expected to gain by 26,000 bpd from the previous month, also the smallest increase since last December, the data showed.

In the Bakken region of North Dakota and Montana, output is due to rise 18,000 bpd to 1.16 million bpd, the highest since March 2022.

Crude oil production in the South Texas Eagle Ford region is due to gain by 9,000 bpd to 1.13 million bpd, highest since April 2020.

Total natural gas output in the big shale basins will increase by about 0.4 billion cubic feet per day (bcfd) to a record 96.6 bcfd in April, EIA projected.

In the biggest shale gas basin, Appalachia in Pennsylvania, Ohio and West Virginia, output will rise to 35.0 bcfd in April, the highest since November 2022.

That compares with a monthly gas output record in Appalachia of 36.0 bcfd in December 2021.

Gas output in the Permian and the Haynesville in Texas, Louisiana and Arkansas will rise to record highs of 22.5 bcfd and 16.8 bcfd in April, respectively.

Gas output in Appalachia was expected to increase even though drillers there have been getting less gas out of each new well for 25 months in a row.

EIA said it expected new Appalachia gas well production per rig to drop to 24.2 million cubic feet per day (mmcfd) in April, the lowest since June 2020.

New gas well production per rig in Appalachia hit a record of 33.3 mmcfd in March 2021.

 

US shale oil output to grow at snail's pace

Oil output from the Permian shale basin in January is set to touch a record 5.6 million barrels per day (bpd), said US forecast on Monday, but the increase is a third of September's pace.

Output in the biggest US shale oil basin is set to rise by about 37,000 bpd, the smallest gain in seven months, based on projections from the US Energy Information Administration (EIA) in its monthly drilling productivity report.

Gains slowed as some of the largest firms are warning of overworked oilfields and less productive new wells.

Overall US output is forecast to reach a record 9.32 million bpd in January, according to the EIA, up only 94,500 bpd over the prior month. In August, the month-over-month increase was 207,500 bpd.

Legacy oil production change, which excludes output from new wells, will show steeper declines in all major shale producing regions in January. Production from new wells, defined as one that began producing for the first time in the previous month, also is expected to fall.

In the Bakken region of North Dakota and Montana, the EIA forecast oil output next month will rise 21,000 bpd to 1.22 million bpd, the largest total since November 2020.

In the Eagle Ford shale in South Texas, output will rise 10,000 bpd to 1.24 million bpd in January, its highest total volume since April 2020.

Natural gas production also is expected to grow by 535 million cubic feet per day to a record 96.28 billion cubic feet of gas per day. US gas production is rising sharply amid growing global need for the fuel.

In the biggest shale gas basin, Appalachia in Pennsylvania, Ohio and West Virginia, January output will rise to 35.53 bcfd, the highest since hitting a record 36 bcfd in December 2021.

Gas output in the Permian and the Haynesville field in Texas, Louisiana and Arkansas will rise to record highs of 21.39 bcfd and 16.41 bcfd in January, respectively.

EIA said producers drilled 1,005 wells in November, the most since March 2020. Total drilled-but-uncompleted (DUC) wells rose by 22 to 4,443 in November, the first monthly increase since June 2020

 

US oil production nears 12 million barrels/day

According to Reuters, oil production in the United States rose to nearly 12 million barrels per day (bpd) in August 2022, the highest since the onset of the COVID-19 pandemic; even as shale companies have said they do not see production accelerating in coming months.

US crude prices have hovered around US$85/barrel after surging into triple-digits this year and boosting fuel costs for consumers. President Joe Biden has called on oil companies to boost production to reduce fuel prices.

Overall US output peaked at 13 million bpd in late 2019, and has not returned to that level since the pandemic started as rigs have been shut in and as costs for equipment and labor increased rapidly.

Several US shale producers recently said well results are disappointing, and production is falling short of forecasts.

"You'll see production tick higher, but I don't think we're going to go ripping higher to 13.1 million barrels," said Bob Yawger, Director of Energy Futures at Mizuho in New York.

A little over two years after the pandemic wrecked havoc on demand and slashed profits, four of the five largest global oil companies brought in roughly US$50 billion in net income in the most recent quarter.

Most major oil majors and large, listed producers are focused on returning profits to shareholders through share buybacks and dividends.

US upstream oil companies are expected to bank a 68% increase in free cash flow per barrel in 2022, while output growth lingers at 4.5% year to date, Deloitte said last week.

Crude production rose 0.9% to 11.98 million bpd in August, highest since March 2020, the US Energy Information Administration (EIA) said in monthly figures.

Natural gas production in the United States hit another record, with gross output in the lower 48 states rising 0.6 billion cubic feet per day (bcfd) to 110.6 bcfd in August. That topped the prior all-time high of 110.0 bcfd in July.

In top oil producing states, monthly output rose 1.6% to 5.10 million bpd in Texas and 0.6% to a record 1.58 million bpd in New Mexico, but fell 0.5% to 1.06 million bpd in North Dakota. Texas's output is at a level not seen since April 2020.

In top gas producing states, monthly output rose 0.9% to a record 31.3 bcfd in Texas and fell 1.5% to 20.4 bcfd in Pennsylvania, lowest since November 2020.