EnergyFactor By ExxonMobil | Pespectives has a new home

Supersized oil production in Texas

Last August I noted that oil production in Texas had soared to an impressive 2.5 million barrels per day.

And it’s still rising.

The latest statistics from the U.S. Energy Information Administration (EIA) show that the state’s daily oil production had shot well past that figure by year’s end. For the month of December, Lone Star State oil output exceeded 2.8 million barrels every single day, thanks largely to ramped-up production in the Eagle Ford Shale and Permian Basin regions. That’s the highest level recorded in Texas since 1986, and represents 35 percent of daily U.S. production.

Crude_Production(2)_04-2014What do those numbers mean? As economist Mark Perry writes, Texas “is pumping so much crude oil, that as a separate oil-producing country, Texas would now be the 8th largest oil-producing nation in the world.”

Pushing toward 4 million bpd

There’s reason to think Texas’s numbers are even higher as we head into May. To quote Perry:

At the current pace of annual increases of 25 percent or more in recent months, Texas crude oil production has probably already surpassed 3 million bpd, and could easily surpass the 4 million milestone by the middle of next year. In that case, Texas may already be out-producing Iraq and will pass Iran sometime later this year to take the No. 6 spot behind Canada. What an amazing story that a single U.S. state could soon be the sixth-largest oil producer in the world, as a separate country!

Together with North Dakota, Texas has helped lead the incredible recent overall increase in domestic oil production in the U.S., which could hit 9 million barrels per day by next year. As EIA points out, “In the three years since 2010, North Dakota’s crude oil output has grown 177 percent and Texas’s output 119 percent, the fastest in the nation.”

Poor policy choices result in lagging production elsewhere

EIA also points out that the Gulf of Mexico, Alaska, and California, which supplied nearly half of U.S. crude production in 2008 – mainly from conventional oil reservoirs – provided less than one-third of national output in 2013. “Output in those areas has declined at the same time that overall national production has expanded.”

But for perspective let me note that the lagging production in those traditional energy-producing regions is more the result of poor policy choices than market forces or geology.

The federal government has limited or prohibited access to resources in the Gulf, in the Arctic National Wildlife Refuge, and in Alaskan coastal waters (not to mention along the Atlantic and Pacific coasts), while policymakers in California have been throwing up roadblocks to production in the resource-rich Monterey Shale.

Removing those obstacles to production could help see those states’ production numbers soar – and their economies thrive – just as in Texas and North Dakota.  And such growth will strengthen the entire nation by creating jobs and opportunities for U.S. workers in every industry.


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