EIA Drilling Productivity Report Update – Sep ’19
According to the EIA’s September Drilling Productivity Report, U.S. oil output is expected to continue to increase through October. 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 are expected to increase 74,000 barrels per day (bpd), or 0.8%, from the Sep ’19 revised production levels to 8.84 million bpd, finishing at the highest figure on record. Oct ’19 production forecasts are expected to finish higher on a YOY basis for the 31st consecutive month, up 11.0% from the previous year levels. The YOY increase in the Oct ’19 production forecast was the smallest experienced throughout the past two years, however. The Oct ’19 projected MOM increase in oil production would be the 19th experienced throughout the past 21 months. Oil production is expected to remain strong within the Permian region (+1.6% MOM), while production is also expected to continue to increase significantly on a MOM basis within the Niobrara (+1.6%) region. The aforementioned regions accounted for over 100% of the total expected YOY gains in production during Oct ’19. U.S. drilled-but-uncompleted (DUC) wells continued to decline from the Mar ’19 record highs, however, finishing lower for the fifth 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 Aug ’19 DUC wells figure of 7,950 finished 1.8% below the previous month, reaching a nine month low level. The MOM decline in DUC wells was the largest experienced throughout the past three years on an absolute basis. Anadarko DUC wells declined most significantly from the previous month, followed by Niobrara and Bakken DUC wells.