EIA Drilling Productivity Report Update – Oct ’19
According to the EIA’s October Drilling Productivity Report, U.S. oil output is expected to continue to increase through November. The Drilling Productivity Report uses recent data on the total number of drilling rigs in operation, estimates of drilling productivity, and estimated changes in production from existing wells to provide estimated changes in oil production for the seven key regions shown below. Oct ’19 production levels were revised 72,000 barrels per day (bpd), or 0.8%, above levels previously forecasted while finishing 81,000 bpd, or 0.9%, above Sep ’19 production levels. Nov ’19 production levels are expected to increase an additional 57,000 bpd, or 0.6%, from the Oct ’19 revised production levels to 8.97 million bpd, finishing at the highest figure on record. Nov ’19 production forecasts are expected to finish higher on a YOY basis for the 32nd consecutive month, up 10.5% from the previous year levels. The YOY increase in production forecasts was the smallest experienced throughout the past 27 months, however. The Nov ’19 projected MOM increase in oil production would be the 20th experienced throughout the past 22 months but the smallest experienced throughout the past six months on an absolute basis. Oil production is expected to remain strong within the Permian region (+1.4% MOM), while production is also expected to continue to increase significantly on a MOM basis within the Bakken (+0.7%) and Niobrara (+0.8%) regions. The aforementioned regions accounted for over 100% of the total expected YOY gains in production during Nov ’19. U.S. drilled-but-uncompleted (DUC) wells continued to decline from the Mar ’19 record highs, however, finishing lower for the sixth consecutive month. DUC wells, which have been drilled by producers but have not yet been made ready for production, have been compiled since Dec ’13. The Sep ’19 DUC wells figure of 7,740 finished 2.6% below the previous month, reaching a ten month low level. The MOM decline in DUC wells was the largest experienced on record on an absolute basis. Anadarko DUC wells declined most significantly from the previous month, followed by Niobrara and Eagle Ford DUC wells.