Marginal wells account for much US production

Dec. 11, 2006
Marginal wells remain an important segment of US oil and gas production operations.

Marginal wells remain an important segment of US oil and gas production operations.

In its latest report, the Interstate Oil and Gas Compact Commission (IOGCC) estimated that these wells in 2005 accounted for about 17% of oil and 9% of natural gas produced onshore US

The report “Marginal Wells: Fuel for Economic Growth,” October 2006, said that these wells in 2005 produced more than 321 million bbl of crude and 1.76 tcf of natural gas, with average daily production reaching its highest in 10 years.

The report outlined also the economic benefits these wells create. It said in 2005, states collected more than $1.2 billion in taxes from marginal wells. In the US, every dollar of marginal oil and gas production created $1.01 of economic activity.

Marginal wells

IOGCC defines marginal oil wells as those producing 10 b/d or fewer. It reported that in 2005 the US had 401,072 marginal or stripper oil wells producing about 2.2 b/d on average (Table 1).

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The organization defines marginal gas wells as those producing 60 Mcfd or fewer, and its report noted that during the last decade the number of marginal gas wells has steadily increased to 288,898 wells (Table 2).

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Its report said that US onshore oil production in 2005 was about 5.1 million b/d with marginal wells producing about 881,000 bo/d. Marginal gas production was about 4.8 bcfd in 2005.

In its statistics on plugged and abandoned wells (Tables 1 and 2), IOGCC does not include temporarily abandoned wells but only wells permanently plugged. These in 2005 amounted to 11,058 oil wells and 4,515 gas wells. Not included in IOGCC P&A’d statistics are orphaned wells, which are wells producing 10 bo/d or fewer and have not been plugged, but whose owners are either insolvent or cannot be located.

The report noted that 11 states have about 73% of the marginal oil wells. These states, which exclude wells in the Appalachian basin, also have 44% of the marginal gas wells.

The Appalachian basin in 2005 accounted for about 50% of the marginal gas wells and almost 29% of the marginal gas production, the report found.

The statistics show that Texas has the most marginal wells, with 124,116 marginal oil and 37,396 marginal gas wells that during 2005 produced about 140 million bbl of oil and 302 bcf of gas.


The Interstate Oil and Gas Compact Commission is a multistate government agency whose stated goal is to promote the conservation and efficient recovery of US oil and natural gas resources while protecting health, safety, and the environment.

IOGCC members include governors from 37 states (30 members and 7 associate states) that produce most of the US oil and natural gas. The organization also has seven international affiliates.

It has monitored the status of marginal oil wells since the 1940s.