EIA Drilling Productivity Report Update – Jan ’21
According to the EIA’s most recent Drilling Productivity Report, U.S. oil output is expected to decline to an eight month low level throughout the month of February. 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. Jan ’21 production levels were revised 173,000 barrels per day (bpd), or 2.3%, above levels previously forecasted but remained 96,000 bpd, or 1.3%, below Dec ’20 production levels. Feb ’21 production levels are expected to decline an additional 90,000 bpd, or 1.2%, from the Jan ’21 revised production levels, reaching an eight month low level. The Feb ’21 projected month-over-month decline in oil production would be the fourth experienced in a row but the smallest experienced throughout the past three months. Record large month-over-month declines in oil production were experienced throughout the months of April and May. Oil production is expected to decline most significantly from the previous month within the Bakken (-19,800 bpd), Anadarko (-19,400 bpd) and Eagle Ford (-19,100 bpd) regions. The expected declines in Bakken, Anadarko and Eagle Ford production levels accounted for nearly two thirds of the total expected decline in production. Feb ’21 oil production is expected to remain lower on a YOY basis for the 11th consecutive month, finishing 17.1% below previous year levels. The projected YOY decline in Feb ’21 oil production would be the second largest on record, trailing only the May ’20 decline. Dec ’20 U.S. drilled-but-uncompleted (DUC) wells declined 1.9% from the previous month, reaching a 25 month low level, overall. DUC wells, which have been drilled by producers but have not yet been made ready for production, have been compiled since Dec ’13. Niobrara DUC wells declined most significantly from the previous month throughout Dec ’20, followed by Eagle Ford and Anadarko DUC wells. Appalachia and Niobrara DUC wells each declined to the lowest levels on record.