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EIA: US shale oil to reach 8.166 million bpd

In its latest forecasts, the US Energy Information Administration (EIA) predicts that US shale oil production will reach 8.166 million barrels per day (bpd) next January.

The EIA has already raised its estimate for December 2018 to 8.032 million bpd, which if correct, will push shale production over the 8 million threshold for the very first time. The agency also predicts overall oil production for the US will reach 12.06 million bpd in 2019, an increase on the 11.76 million bpd it forecast six months ago.

While there had been some concern about takeaway constraints, especially in the Permian Basin, shale operators like ExxonMobil, which also makes lubricants for Mobil UK distributors, continue to improve their efficiency at extracting gas and oil. Jozef Lieskovsky, an EIA analyst, says that the industry has managed to bypass the bottlenecks in some regions.

He also pointed to a good completion rate, saying:

“And, well completions are coming a little stronger. We could probably take 100 rigs out and still keep up with the completions we’re doing right now.”

The number of drilled but uncompleted (DUC) wells rose to 8,723, however, with there being over 4,000 in the Permian Basin alone. While the limited takeaway capacity is one likely reason, Lieskovsky points to other reasons for the well backlog, such as the currently lower oil prices and a desire to save wells until late 2019. Operators are also fine-tuning their well-completion processes, such as by drilling a number of wells at different depths for later completion in groups.

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