Kemp: US Set To Get More Accurate Oil Production Data
Sampling tends to concentrate on larger businesses that account for most oil and gas production, refining, storage and consumption, and have the resources to fill in the forms without too much effort.
Surveys work well for oil refining and imports because there are fewer than 150 refineries in the United States (and many companies own more than one refinery). The number of oil importers and stockholders is not much higher. So surveying oil imports, refinery throughput and stock levels is comparatively straightforward.
There are many more oil and gas producers: around 13,000 well operators, according to the Independent Petroleum Association of America. The bulk of oil and gas production comes from a small number of big operators, with the rest produced by a multitude of small firms, who fiercely dislike federal bureaucracy.
State Records
Below the federal level, every state requires well operators to file production records so that taxes can be assessed and the well regulated properly. The EIA has relied on these records to compile its own estimates of national oil production without conducting its own survey.
The problem is these records are finalised with a long delay. "Over the past 26 months, final crude oil production for the 19 states and the Gulf of Mexico was reported, on average, more than nine months after the end of a month," the EIA explained in a briefing to trade associations in July 2014.
Texas, which accounts for more than one-third of national production, takes on average 29 months to finalise its output numbers, and production typically increases 40 percent between the volume initially reported and the final figure.
Long delays in collecting state data did not cause major estimating errors in the late 1990s and early 2000s, when nationwide production was declining but only very slowly, and did not change much from one month or one year to the next.
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