The US Energy Information Administration said average first-of-the-month prices used to calculate US reserves dropped in 2016 compared with 2015. Natural gas and crude oil decreased by a respective 6% and 15% during the period.
EIA’s report, US Crude Oil and Natural Gas Proved Reserves, Yearend 2016, showed a 5% increase in proved gas reserves to 341.1 tcf. Oil and condensate increased by 3% in the Lower 48 states, but reserves in Alaska and the federal offshore decreased bringing the yearend 2016 reserves to 35.2 billion bbl, which was a net decline of 17 million bbl.
EIA highlighted onshore proved crude and condensate reserves that increased by 846 million bbl (3%) in the Lower 48, but these were offset by the 865 million bbl decline in reserves for Alaska, and federal and state offshore areas. The administration noted that higher development costs in these areas most likely prohibited reserves growth in most recent low-price environment.
Texas and Oklahoma showed the highest net increases in 2016, with the liquids-rich shale plays in the Permian basin—Wolfcamp and Bone Springs—and the SCOOP and STACK plays in Oklahoma’s Anadarko basin (OGJ Online, Jan. 30, 2018).
Despite these gains, EIA said crude and condensate production slipped by 6% from 2015. Total reserves were kept constant from new field additions and new reservoirs identified in previously discovered fields. Existing field extensions also kept US reserves buoyed against production offsets.
Pennsylvania showed the largest net natural gas increase, adding 6.1 tcf to US proved reserves. The increase is attributed to ongoing Marcellus shale development in the Appalachian basin. Oklahoma struck again in the top performers during the period as the state added 3.7 tcf of natural gas reserves from the SCOOP and STACK plays (OGJ Online, Feb. 18, 2018). Ohio’s 3.1 tcf addition is attributed to recent developments in the Utica shale play (OGJ Online, Jan. 9, 2018).
US natural gas production showed a minor 1% decrease from 2015, according to EIA. Shale gas once again dominated US reserves growth, increasing to 62% of reserves in 2016 from the 2015 share of 54%. Natural gas reserves additions exceeded production by more than 30% in 2016.
EIA reported that net revisions in US 2016 oil and gas reserves were below its 2015 report, while extensions and discoveries remained at the same level.
Contact Tayvis Dunnahoe at [email protected].