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Fracking Boosts U.S. Oil to 10 Percent of Global Supply

The U.S. now contributes more than 10 percent of the total global crude oil supply as of the end of 2013, a result of the advances in hydraulic fracturing and drilling technology that are driving the oil and gas boom in Texas, North Dakota and other Western states, new U.S. Energy Information Administration data show.

The drilling frenzy in the West's oil fields is mainly about one thing: "tight" crude. 

Most of the easiest oil to drill in the U.S. has been in decline, so energy companies over the last decade have looked to layers of rock that oil cannot easily flow through called "tight" rock formations to unlock oil and natural gas that was previously too costly to reach. Getting that tight crude requires hydraulical fracturing, or fracking, using high volumes of water, sand and chemicals injected at high pressure to crack open, or frack, the rock, allowing the oil to flow into a well. 

Based on fourth quarter 2013 data from U.S. Energy Information Administration

The list of ways the rush to produce tight oil in the U.S. may affect climate change and the environment is long and fraught with uncertainty: Scientists say there has been too little study on the impacts of oil and gas development on water supplies and the climate. Climate change-driving methane leaks in oil and gas production equipment haven’t been fully quantified. Natural gas burned off from oil wells in North Dakota's Bakken shale oil fields dumps millions of tons of carbon dioxide directly into the atmosphere. And, the burning of crude oil is a direct contributor to climate-changing carbon emissions.

Only the U.S., Canada and Russia produce tight oil commercially, the EIA reports, but the U.S. is by far the globe's top producer. Whereas Canada and Russia produce only a few hundred thousand barrels of tight oil per day, the U.S. produced more than 3.2 million barrels of tight oil each day during the fourth quarter of 2013, amounting to more than 40 percent of total U.S. oil production and 4.3 percent of total global oil production. U.S. crude oil is now 10.4 percent of the total global oil supply.

About 63 percent of U.S. tight oil comes from two places: western North Dakota’s Bakken shale, which is slated to be tied into the controversial Keystone XL Pipeline; and the Eagle Ford shale located in drought-stricken southern Texas.

Energy companies in both oil fields have been ramping up oil drilling, fracking and production dramatically since early 2010, when almost no oil was produced in south Texas. But after just four years, energy companies there produce as much as 1.3 million barrels of oil per day. That level of oil and gas development used more than 19 billion gallons of water between 2011 and 2013 in south Texas, stirring concern that energy development there could make the region more vulnerable to drought and water shortages, both of which could be exacerbated by climate change.

Much of that water in south Texas comes from aquifers deep underground that are being depleted by fracking, which uses up to about 4.5 million gallons of water per well, Monika Freyman, senior manager of the nonprofit group Ceres’ water program, said in February. Freyman is the author of a Ceres report issued last month detailing the energy industry’s impact to Texas water supplies.

So far, drought conditions haven’t slowed the pace of energy development anywhere in the U.S., and whatever its overall environmental impact, crude oil production in the U.S. is expected to keep increasing over the next few years. The EIA expects crude oil production in the U.S. to continue to rise from 7.84 million barrels per day produced in the fourth quarter of 2013 to a peak of just under 10 million barrels per day in 2019. After that, production is forecast to decline only gradually through 2040.

If that scenario plays out, it will mean the U.S.’s prominence as a crude oil producer will continue its rise, at least for a while, despite the many possible ways fracking could fuel climate change. 

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Comments

By Sue Spencer (NY)
on March 30th, 2014

“That level of oil and gas development used more than 19 billion gallons of water between 2011 and 2013 in south Texas…”

The indisputable fact is 19 BILLION gallons of water was not only “used,” it was IRREPARABLY CONTAMINATED - by extremely dangerous fracking chemicals and by radioactive material along with other toxic substances sealed underground and released by the fracturing process.  The fractures, which extend two miles out in every direction from the central vertical mile-deep well, also become pathways for contamination to easily spread into area groundwater supplies.

Let’s realize that just one, ONE gallon of such contaminated water can poison one MILLION gallons of clean water - so let’s multiply 19 billion by 1 million to get an idea of the insane risk being created in Texas alone - dare we do the math to include all the wells being fracked in our country?!  (There are more than one million fracked wells in the US)

Let’s also realize that the plan is to export the vast majority of fuel fracked in the US to other countries where the industry can receive a higher profit.  So we sacrifice our health and clean drinking water in order for the fracking industry to make enormous sums of money selling US natural gas overseas.

Then who will be selling us clean water?  And how much will it cost?

“.... the U.S. is by far the globe’s top producer…..”

That’s because we are being sold out and sacrificed - European countries are banning fracking….France, Germany, Ireland and Bulgaria currently have bans, other countries have regional bans or moratoriums.
See…  http://oilpatchasia.com/2013/10/9-countries-or-regions-that-ban-fracking/

We can generate fracking bans in the US at the state (Vermont was the first) and municipal level.
A list of US and worldwide bans can be found here…  http://keeptapwatersafe.org/global-bans-on-fracking/

“The list of ways the rush to produce tight oil in the U.S. may affect climate change and the environment is long and fraught with uncertainty:”

We certainly know enough to realize fracking is a bad idea.
Sustainable means of meeting our energy needs are at our fingertips.

Reply to this comment

By Roger Blanchard (Sault Ste. Marie, MI 49783)
on March 30th, 2014

Several points should be made about predictions of future tight oil production in the U.S. 

First, could it be that predictions of future tight oil production by the Energy Information Administration (EIA) may diverge significantly from actual production?  I wrote a paper awhile back illustrating their poor prediction for North Sea oil production from the late 1990s (see http://www.resilience.org/stories/2011-04-19/look-back-north-sea-oil-production-projections).  I’ve also shown that their predictions for the Gulf of Mexico and Mexican oil production were also not very good (http://www.resilience.org/stories/2012-02-17/how-reliable-are-us-department-energy-oil-production-forecasts and http://peak-oil.org/2010/01/mexican-oil-production-continues-to-dive/).  Unfortunately, nobody in the media looks back at EIA oil production predictions.

In terms of tight oil production in the U.S., it appears to me that the EIA prediction may diverge significantly from actual production rates in the future.  Most of the oil production increase in the U.S. since 2010 has come from Bakken and Eagle Ford shale formations.  In 2011 I predicted that Bakken would peak in 2014 +/- 1 year.  Recently international petroleum geologist Jean Laherrere predicted Bakken would peak in the fall of 2014.  Also, David Hughes, who has done an extensive analysis of Bakken, has revised his predicted peak to 2015. 

There is increasing evidence that a Bakken peak will be coming soon.  It’s important to note that about 90% of Bakken oil production in North Dakota comes from 4 counties: Mountrail, McKenzie, Williams and Dunn.  The reason for that is because that is where the oil is.  Initial production rates in Bakken counties outside of the top four counties drops off significantly which I recently showed (see http://peak-oil.org/2013/11/analysis-of-well-completion-data-for-north-dakotas-bakken-formation/). 

The general assumption concerning Bakken and Eagle Ford is that if the number of new wells continues to increase, production will increase until the play is totally saturated with wells.  My argument is that as the fruitful area gets saturated with wells, I expect production to decline because wells outside of the core area will not be as productive.  Based upon my calculations and assuming 500 acres/well, the core area will be pretty well saturated with wells by the end of this year.

Compounding the problem of less productive wells in the future is the fact that tight oil wells decline rapidly (see http://peak-oil.org/2013/11/analysis-of-well-completion-data-for-north-dakotas-bakken-formation/).  There are more and more wells that are in decline so an increasing number of new productive wells have to be added to negate the declining wells.  If the new wells decline in initial production, that just means more wells have to be brought on-line more rapidly.  At some point, the new wells can’t keep up. 

Based upon data in the Bakken Weekly, 964 wells were completed from the week of Jan. 1 through the week of March 17 of this year and the sum of the initial productions was 588,539 b/d.  That compares to 586 wells and 465,877 b/d for the same period in 2013.  The ratio of 2014/2013 wells is 1.65 and the ratio of 2014/2013 initial production is 1.26.  That indicates that initial production/well is declining.

There have been several media articles recently stating that oil companies are losing money on tight oil projects and that oil companies are starting to cut back.  If that indeed happens, that would make it even more likely that tight oil production will decline in the near future.

Recently I read an article which stated that wildcatters were leaving the Bakken region and going to east Texas to look for oil.  If there were a lot of fruitful areas to drill in the Bakken region, why would wildcatters want to leave North Dakota? 

What I’ve stated about Bakken applies to Eagle Ford as well.  Production ramped up a little later in Eagle Ford but the intensity of the drilling activity has been higher than in the Bakken region so I expect a peak there in 2014/2015.  It won’t be long before we find out if that is correct.

The oil industry has drilled wells in the best shale plays as fast as humanly possible and production ramped up rapidly.  The down side of that is that production can also decline rapidly after the peak.  Jean Laherrere projects that Bakken production will decline ~80% by 2020 from its peak.  David Hughes projects that Bakken production will be essentially zero by 2035, 21 years from now.

Reply to this comment

By Michael Gibbons (Oceanside, California 92058)
on March 30th, 2014

Very interesting article, when you look at the amount of water used comparative to the amount of oil produced, the question is are we robbing peter to pay Paul.

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