Oil shale boom boosts US monthly oil production to 15-year high

Michael Bastasch | Energy Editor

Huge increases in oil production from shale formations using horizontal drilling and hydraulic fracturing has paid off. U.S. monthly crude oil production is at its highest levels since 1998, averaging nearly 6.5 million barrels per day in September of this year, according to the Energy Information Administration.

The states of North Dakota and Texas had the largest increases in oil production, and have helped U.S. oil production increase by more than 900,000 barrels a day since September of 2011.

“Today’s report from EIA reflects the potential for American energy security that comes from sensible policies at the State and Local level that allow leasing, permitting, and drilling to occur,” said American Energy Alliance spokesperson Benjamin Cole in an email.

Between September 2011 and September 2012, drilling in the Eagle Ford shale formation and the Permian Basin has let Texas oil production jump by more than 500,000 barrels per day. Drilling in the Bakken shale formation has allowed North Dakota production to shoot up by more than 250,000 barrels per day.

“North Dakota now surpasses Alaska in oil production, and yet the Peace Garden State is only one-sixth the size of Alaska. Why? Because North Dakota welcomes the economic boom that has given it the lowest unemployment in the country,” Cole added.

Oil production has been rising rapidly for the past few years, mainly due to a boom in shale oil production on state and private lands.

The Congressional Research Service found that 96 percent of the increase in oil production from 2007 to 2012 was produced on private and state lands.

Though oil production in federal lands is up since 2007, it declined between 2010 and 2011.

According to the Institute for Energy Research, oil production on federal lands fell 11 percent from 2010 to 2011 — mainly due to the Obama administration’s offshore drilling moratorium — while production on private and state lands increased by 14 percent.

“Meanwhile, the Obama administration continues to restrict offshore development in Alaska, refuses to tap the NPRA or allow drilling in ANWR,” Cole said. “The Alaska pipeline is operating at one-fourth capacity, and there is no indication that things will change for the next four years.”

Just days after the November election, the Obama administration closed off 1.6 million acres of federal lands originally slated for shale development, according to The Hill, despite the president touting his record of expanding oil drilling on federal lands during the campaign.

However, CRS also found that the share of oil production from federal lands only fell 2 percent from 2007 levels — 31 percent of total oil production.

“If the federal government would follow the example set by energy producing states, we could put millions of more people back to work, lower the cost of energy, and grow our economy,” Cole said.

“The EIA report reveals a fraction of the real potential America has for domestic energy production, if federal regulators were as concerned about sustainable jobs and affordable energy as they were about satisfying anti-fossil fuel activists,” he concluded.

Production in small-producing states like Oklahoma, New Mexico, and Wyoming helped to boost domestic crude production as well.

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