IEA Revises Up U.S. Light Tight Oil Forecast on New Techniques
The growth in the production of U.S. light tight oil, or shale oil, is expected to be faster than expected because of application of new techniques, the International Energy Agency said.
The combination of the application of horizontal drilling and hydraulic fracturing techniques with the lessons learned producing shale gas has “greatly boosted oil recovery rates,” the Paris-based IEA said today in its monthly oil market report.
“The number of oil drilling rigs in the United States jumped by 34 this week to 1,112, the highest on record and 50 percent higher than last year,” the agency said. It revised up the outlook for production of 2012 light tight oil by about 120,000 barrels a day to 810,000 barrels a day.
In North Dakota, where the Bakken and Three Forks acreage accounts for almost 90% of production, monthly output has risen by 6% on average in the last three months, it said. These leading indicators are also evident in the California’s Monterey, Rockies’s Niobrara and Texas’s Eagle Ford tight oil formations.
The IEA tempered the upward revision to the U.S. light tight-oil production outlook because of the high reported decline rates and the high capital costs in shale oil formations, according to the report.
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