Fewer rigs means lower production in US shale
Friday, January 1, 2016
While domestic crude oil production may increase in January and February, U.S. oil and gas companies have cut workforce and some have even filed for bankruptcy during the year and a half price decline and supply glut.
Crude oil prices remain lower than it costs to produce a barrel, Houston Chronicle reports, and drillers are strained to produce more oil and gas with fewer rigs.
The United States’ three largest shale plays — the Bakken in North Dakota, the Permian Basin in West Texas and the Eagle Ford in South Texas — produced 14.3 percent less than in 2014. Companies have cut the number of operating rigs and have relied on the most prolific parts of formations to keep making money.
Via: Houston Chronicle > US shale companies can’t do more with less anymore
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Shale FAQ
What is fracking?
Fracking is a slang term for hydraulic fracturing. Fracturing is a process by which highly pressurized fluid is pumped thousands of feet into the ground to fracture rock formations. The goal is to release the natural gas that’s locked inside the rock.
Is it safe?
What most concerns people about fracturing is ground water contamination. The worry is that fractures underground, caused by the process, will extending upwards and into aquifers, releasing gas and chemicals into the ground water supply. There’s been no confirmed reports of such a thing happening. Though surface spills and drill site blowouts can lead to localized environmental concerns.
Will my water catch on fire?
Flammable water is caused by the release of methane gas into a drinking water supply. Methane gas occurs naturally and can be released by any kind of drilling, including water wells. In Pennsylvania officials fined Chesapeake Energy $1 million for contaminating ground water with methane. It was determined that the company had not properly cemented it’s boreholes and gas migrated up the well, between rock and into aquifers.