Jonathan Cogan of the Energy Information Administration (EIA) said last week that production in the Eagle Ford formation in South Texas reached 1.2 million barrels per day in December. Additionally, production from the West Texas Permian Basin averaged 1.3 million bpd and is projected to grow more than any other U.S. region through 2015.
If Texas was an independent country, it would rank 10th overall in production, according to the American Enterprise Institute. Texas production could surpass 3 million barrels per day in 2014 and reach 4 million barrels per day by 2015.
Texas is the primary catalyst for the increased U.S. production is one reason why we expect that the average price of gas in 2014, nationwide, should decline once again. It declined from $3.60 per gal. in 2012 to $3.49 per gal. in 2013.
It's important to grasp the enormity of Texas especially when the media chooses to focus so much attention on the prosperity that Bakken oil is bringing to N. Dakota. (It's well deserved.)
AP reported this month that North Dakota produced 313 million barrels of oil in 2013, a record amount, and that’s about 70 million more than it produced in 2012. For ND, that’s six consecutive years of record oil production. State data shows that the 185 oil rigs working there now double the amount from four years ago.
But when your attention is drawn to the Texas oil boom that discussion takes place on another plane entirely, and that’s because of the previously inaccessible shale wealth that transforms state economies via fracking.
With these numbers, the Lone Star State could surpass Kuwait and the UAE to reach the No. 8 spot by the end of next year and could surpass Iraq, Iran and even Canada by the end of next year to take the No. 6 spot. The state says it derives one-third of its economy and 2.1 million jobs from the oil & gas industry.
Of course, we shouldn’t overlook the nest on which California is perched. As extraordinary as the resources are with which Texas has been blessed, California’s Monterey shale accounts for two-thirds of the nation’s estimated shale oil reserves. EIA estimates 15.4 billion barrels. That’s billion with a ‘B'.