By Velda Addison, Hart Energy
The United States has another reason to be thankful this season: operators in prolific shale plays pushed proved reserves of crude oil and natural gas to record levels in 2014.
According to the U.S. Energy Information Administration (EIA), proved reserves of crude oil and lease condensates jumped to 39.9 billion barrels (Bbbl), up 9.3% from 2013. The EIA said it was the first time since 1972 that the amount exceeded 39 Bbbl. Proved reserves of natural gas also rose, jumping 9.8% to hit 388.8 trillion cubic feet (Tcf) in 2014.
The increases marked the sixth and second consecutive year gains for oil and gas proved reserves, respectively.
So which states saw the biggest increases?
When it comes to oil, Texas dominated with development of tight oil plays such as the Wolfcamp and Bone Spring in the Permian Basin as well as the Eagle Ford Shale play. The EIA reported that Texas added 2.1 Bbbl of crude oil and lease condensate proved reserves, bringing its contribution up to about 14 Bbbl. The volumes added accounted for 60% of the total net increase in 2014 for the U.S.
Following Texas was North Dakota, where proved oil and condensate reserves jumped by 362 MMbbl to about 6 Bbbl courtesy of the Bakken tight oil play in the Williston Basin.
Other states that saw increases in crude oil and condensate were New Mexico’s Permian Basin and Colorado’s Denver Basin Niobrara/Codel tight oil play.
While proved reserves from the federally-owned parts of the U.S. Gulf of Mexico (GoM) dropped slightly in 2014 compared to the previous year, the region was still among the top three overall contributors for proved oil reserves. EIA data show proved reserves in the GoM stood at more than 4 Bbbl.
On the natural gas side, proved reserve additions were the highest in Pennsylvania, the EIA said. Here, operators added 10.4 Tcf of proved gas reserves in the Marcellus, bringing its total to about 60 Tcf.
Gains were also great in Ohio, where development of the Utica Shale play more than doubled proved natural gas reserves.
But in terms of overall proved reserves of gas Texas remained on top with more than 100 Tcf, followed by Pennsylvania with Oklahoma, West Virginia and Wyoming rounded out the top five contributors.
“West Virginia added enough Marcellus natural gas proved reserves to surpass Wyoming and Colorado to become the fourth-largest natural gas reserves state,” the EIA said in its report.
In addition, oil and gas imports have continued to fall as production has grown. Crude oil imports fell 5% sequentially in 2014, while gas imports dropped by 6%.
While the report mostly shed light on growth and reserve additions, days of record-setting output and proved reserve growth could be limited due to commodity prices.
“Sustained low prices for oil and natural gas are anticipated to reduce the reserves in EIA’s next report (for year-end 2015),” the EIA said. “Lower prices have curtailed drilling and made recovery economics more challenging. Although resource estimates are not necessarily reduced by lower prices, the calculation of proved reserves is sensitive to price.”
The EIA predicts that the 12-month, first-of-the-month 2015 average WTI spot oil price will be $50.36 per barrel. That’s a 47% decrease from the 2014 average.
Velda Addison can be reached at email@example.com.