United States crude oil production for 2009 is on target to have its biggest one-year jump since 1970, according to a Platts analysis of industry data released Nov. 27.
With U.S. oil production averaging 5.268 million barrels per day (bpd) through October, the percentage gain in U.S. output will be the most since the country produced 9.637 million bpd in 1970, which turned out to be the peak year of U.S. crude output, according to Platts’ analysis of data published by the U.S. Energy Information Administration (EIA). If that 5.268 million bpd figure holds through December, this year would show a 6.4 percent boost from the 4.95 million bpd average of 2008 and rank as the best U.S. oil production year since 2004, when output averaged 5.419 million bpd.
For comparison, in the 40 years since U.S. oil production peaked, annual output has jumped only eight times. Seven of those increases were minimal; only in 1978 was there a jump of significant magnitude, an increase of 5.6percent, to 8.7 million bpd.
Last year’s hurricane curtailments distorted the production numbers somewhat for the 2008 comparison, given that 183,000 b/d of Gulf of Mexico output was still offline at the end of that year. However, 2009 is still expected to post increases of 3 percent and 4 percent from the relatively storm-free years of 2006 and 2007, respectively.
Projections from the U.S. Minerals Management Service (MMS) indicate that the primary driver for this year’s U.S. oil production resurgence is the Gulf of Mexico, where operators have begun launching a group of new fields, fulfilling what has been a decade-long focus on unlocking the promise of deepwater exploration there.
Platts concluded that with three trends–the jump in the Gulf of Mexico, further development of the Bakken Shale oil play in North Dakota and success by a group of operators now training their onshore exploration sights toward new oil targets at the expense of natural gas–it appears the U.S. has a chance of at least maintaining oil output in the range of five million to six million bpd for some years to come. “We see it above five million barrels per day for the next 10 years or so,” said Peter Jackson, senior director for IHS CERA. “There is still a tremendous amount of exploration potential in the U.S. and that plateau could be sustained.”