Terminology can seem to trivialize something that is actually quite important. Consider US marginal crude oil and natural gas wells. Individually, they produce 10 b/d of crude or 60 Mcfd of gas or less. Collectively, they matter a lot, a recent Interstate Oil & Gas Compact Commission report showed.
Such wells remain in widespread operation across the US and continue to reliably produce a meaningful share-72.2% of all operating domestic wells-despite current industry challenges, IOGCC's 2015 Marginal Well Report said.
"The time period provided in this particular report is during a dramatic shift in production with extreme price swings for the oil and natural gas industry," noted IOGCC Executive Director Carl Michael Smith. "This report will show the vital role marginal wells play for our nation's energy security and independence."
The report, which included activity in 29 states, is based on data from the association of state oil and gas regulators' marginal well survey that covers production activity for calendars years 2013, 2014, and 2015. It found that marginal, or stripper, wells have contributed more than $300 billion of production in the form of 2.85 billion bbl of oil and 19.9 billion Mcf of gas over the last 10 years.
"Marginal wells are an integral part of Oklahoma's oil and natural gas landscape," Oklahoma Energy Resources Board Executive Director Mindy Stitt said. "Along with the IOGCC, the OERB and Sustaining Oklahoma Energy Resources are committed to supporting marginal well owners and operators through both public and professional education."
The report said that the number of producing marginal US wells increased by nearly 24,000, or 3%, since the prior survey in 2012. Marginal production remains a substantial share of domestic oil and gas operations, it added.
'Small business sector'
"Stripper wells are the small business sector of the nation's oil and gas industry. They are frequently family-owned, predominantly in rural areas, and passed down through generations," said National Stripper Well Association Chair Darlene Wallace, who also owns and operates Columbus Oil Co. in Seminole, Okla.
Elimination of such wells in 2015 would have triggered an estimated direct loss of 57,560 oil and gas jobs and $4.4 billion in direct earnings within the survey states, according to the report, which can be found at IOGCC's web site.
"This important study provides the justification for maintaining access to literally billions of barrels equivalent of reliable oil and gas in the US," Research Partnership to Secure Energy for America Pres. Thomas Williams said. It also could help identify fair tax and regulatory policies for domestic conventional oil and gas wells as well as research and development needs, he said.
