magazine

Feature
By the Numbers
By Andrea Danelak
Methods for tracking oil
production recently received
a facelift, thanks to
the United States Energy
Information Administration
(EIA). In the past, oil production was
tracked by simply calculating the number of
rigs in operation. However, in the Bakken
region, production numbers were flourishing
while rig counts were going down—a trend
that required the EIA to delve deeper into
those statistics.
“All areas had the same issue. It was that
very problem that prompted us to get a new
technology and insight into productivity,”
says Lynn Westfall, director of energy markets
at the EIA, a statistical and analytical
agency within the United States Department
of Energy.
The EIA spent over one year gathering and
analyzing data to find a way to better track
the country’s oil production. To that end, it
developed the Drilling Productivity Report
(DPR), a monthly publication that looks at active
development within the most prolific areas
in the country, which were included based on
their recent drilling activity and rapid production
increases. The report does not distinguish
between oil-directed rigs and gas-directed rigs.
Using new insights to
determine production
The rig count remains an important factor
in oil and natural gas production changes,
so the DPR examines recent data on the total
number of drilling rigs in operation. It also
factors in estimates of drilling speed and efficiency,
the expected yield from new wells and
the change in production from existing wells,
all of which can help to determine regional
oil and natural gas production.
“In a nutshell, our report covers six of the
largest shale formations—large by means of
production,” says Westfall. Using the EIA’s
new insights, the DPR provides a summary
of the previous two months of production, as
well as the next two months in relation to the
month in question. “Having that short-term
view can be very valuable,” he adds.
The completion rate of wells in each play
is a critical factor in assessing new production.
“It is about understanding, ‘How many
more wells will we have in this basin? If we
bring in one extra rig, how quickly can we
see new wells and how quickly can they produce?’
says Jozef Lieskovsky, a senior analyst
at the EIA who designed the report.
BASIN BITS | Spring 2014 101