U.S. oil production surge continues, supported by strong prices

Crude and condensate. Prices that hovered from the low $90s through $110/bbl throughout the year kept the drill bits turning and the oil flowing in 2013. World Oil’s estimated crude and condensate production, based on data from the Energy Information Administration and API, reached 7.48 million bpd last year, and never looked back. These are levels not seen since 1991. The production bump represents a year-over-year increase of 15%, almost a million bpd.

U.S. gas consumption and marketed gas production, Tcf.

Much of the increase was uniform across the regions of the country, with only Alaska seeing a significant decline. Other areas showed the results of longer laterals and intelligent completions, with a special emphasis on the older, traditional producing state of Texas, which saw production jump 25%. The Lone Star state benefited not just from increased activity in the mature provinces of West Texas, but increasingly in the south-central, Eagle Ford shale region. Texas produced over a billion barrels of liquid gold in 2013.

North Dakota’s Bakken shale in the northwestern part of the state saw its production boom continue unabated. The state increased liquids production 30%, or almost 200,000 bpd in 2013, putting the region within striking distance of a million bpd by year-end 2014. North Dakota easily maintained its third-place position among producing states, behind only Texas and a combination of Louisiana and the federal Gulf of Mexico. Louisiana production stayed fairly flat, with only a modest increase in 2013, almost entirely offshore.

The Rocky Mountain states of Colorado and New Mexico both experienced healthy increases last year, for different reasons. Colorado’s Green River formation, located in a relatively small area (784,000 acres) of Colorado’s Piceance basin, is one of the richest oil shale deposits in the country. Oil production rose over 26% to top 170,000 bpd, and shows no signs of leveling off. In New Mexico, oil was produced from that state's side of the Permian basin.

Natural gas. Prices finally began to stabilize and trend upward in 2013, though as a target for drillers, natural gas still plays the poor step-sister. This did not keep production from increasing once again. Marketed production exceeded 70 Bcfd last year, as wellhead prices on the Henry Hub averaged just over $4/Mcf. Unseasonably cold weather at the end of the year pushed gas consumption, both residential and industrial, to over 71 Bcfd, according to EIA, despite declines in natural gas used for electric power generation from 24.9 Bcfd in 2012 to 22.3 Bcfd in 2013.