Eagle Ford Crude Oil Production Still Not On Pre-Pandemic Levels
Constant increases in the past six months have not yet put Eagle Ford crude oil production on par with pre-pandemic levels, the U.S. Energy Information Administration said.
According to the EIA’s latest Drilling Productivity Report, crude oil production in the Eagle Ford region in southern Texas is estimated to average at around 1.2 million barrels per day (bpd) during September 2022. Despite recent increases, less crude oil is being produced in the Eagle Ford region than before the pandemic – 1.4 million bpd in April 2020 – and much less than the all-time high of 1.7 million bpd in March 2015.
Because prices increased, we estimate that economically recoverable oil resources – the amount of recoverable oil that producers believe can be profitably produced – in the Eagle Ford formation, increased to 8.4 billion barrels in the first half of 2022, an increase from 0.5 billion barrels in 2020.
The EIA said that, between 2020 and the first half of 2022, crude oil prices more than doubled, incentivizing future development in previously marginal areas.
This analysis of the Eagle Ford formation focuses on proven reserves and economically recoverable resources. Proved reserves are volumes of crude oil and natural gas that data demonstrate with reasonable certainty can be recoverable in future years from known reservoirs, considering existing economic and operating conditions.
In contrast, economically recoverable resources vary considerably depending on price and cost assumptions. Economically recoverable resources represent a less certain estimate of future crude oil and natural gas volumes and production.
If prices are too low to provide a return on the investment of developing the well, producers will not invest in drilling the well. The Eagle Ford formation produces both crude oil and natural gas, so profitability is not only based on past crude oil or natural gas production rates but also on producers’ forecasts of future prices for natural gas and crude oil.
To contact the author, email bojan.lepic@rigzone.com
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