EIA Drilling Productivity Report Update – Dec ’20
According to the EIA’s most recent Drilling Productivity Report, U.S. oil output is expected to decline to a seven month low level throughout the month of January. 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. Dec ’20 production levels were revised 62,000 barrels per day (bpd), or 0.8%, above levels previously forecasted but remained 125,000 bpd, or 1.6%, below Nov ’20 production levels. Jan ’21 production levels are expected to decline an additional 136,000 bpd, or 1.8%, from the Dec ’20 revised production levels, reaching a seven month low level. The Jan ’21 projected month-over-month decline in oil production would be the fourth experienced in a row and the largest experienced throughout the past eight 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 Permian (-43,600 bpd), Eagle Ford (-25,600 bpd) and Bakken (-22,500 bpd) regions. The expected declines in Permian, Eagle Ford and Bakken production levels accounted for over two thirds of the total expected decline in production. Jan ’21 oil production is expected to remain lower on a YOY basis for the tenth consecutive month, finishing 18.0% below previous year levels. The projected YOY decline in Jan ’21 oil production would be the second largest on record, trailing only the May ’20 decline. Nov ’20 U.S. drilled-but-uncompleted (DUC) wells declined 1.9% from the previous month, reaching a two year 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 Nov ’20, followed by Eagle Ford and Anadarko DUC wells. Niobrara DUC wells declined to a seven year low level, overall.