DENVER, April 20, 2015 /PRNewswire/ -- Oil production from key shale formations in North Dakota and Texas increased by 17,000 barrels per day (b/d), or 1%, in March versus February, according to Bentek Energy, an analytics and forecasting unit of Platts, a leading global provider of energy, petrochemicals, metals and agriculture information.
In South Texas, Eagle Ford basin crude oil production averaged 1.6 million barrels in March, up 344,000 incremental barrels per day (b/d) or 28% from March 2014, according to Sami Yahya, Bentek energy analyst. Additionally, crude oil production in the North Dakota section of the Bakken shale formation of the Williston Basin averaged 1.2 million b/d in March, Bentek data showed. This was 215,000 b/d higher than the year ago level.
"Producers in both the Eagle Ford and Bakken basins are still maintaining their production levels by high-grading their acreage and pushing for better efficiencies," explained Yahya. "The current average economic return for the two basins is 17%. However, the downside risk is that some producers may elect to increase their number of drilled-but-uncompleted wells in the near term—until they figure out their cash flow status—which will further flatten or bring down production levels."
Bentek analysis shows that from March 2014 to March 2015, total U.S. crude oil production has increased by 1.3 million b/d.
"Prices of both Eagle Ford and Bakken shale oil have been on an upward trajectory since mid-March and reached a year high in early April," said Jacqueline Puig, Platts associate editor of Americas crude.
The Platts Eagle Ford Marker, a daily price assessment launched in October 2012 and reflecting the value of oil out of the Eagle Ford Shale formation in South Texas, is up 25% since mid-March, with an average price of $53.30 per barrel (/b) for the year. The marker has ranged between $46.22/b and $62.20/b since the beginning of January.
The price of oil out of the Bakken formation at Williston, North Dakota, is up 36% since mid-March, with an average price of $46.81/b for the year, according to the Platts Bakken assessment. It has ranged between $38.43/b and $57.45/b since the beginning of January.
The Platts Bakken, introduced April 22, 2014, is a daily assessment of price for oil closest to the wellhead prior to determination of transportation by rail or pipe. The assessment reflects a sulfur content of 0.2% or less and an American Petroleum Institute (API)** gravity of 42 or less, similar to the nature of North Dakota Light Sweet crude. The Platts Eagle Ford Marker reflects the value of a median 47-API Eagle Ford crude barrel, based on the crude's product yields and Platts product price assessments, adjusted for U.S. Gulf Coast logistics.
Platts introduced the world's first independent daily price reference valuing crude oil produced from a shale formation in May 2010 when it began assessing Bakken Blend shale oil injected into pipelines at Clearbrook, Minnesota, and Guernsey, Wyoming.
For more information on Platts price assessments methodology visit these links: Details of Platts Bakken and Platts Eagle Ford Marker. Bentek Energy's shale oil production figures are derived from proprietary data models using publicly available data. For more information on data models, reports or Bentek's methodology, please contact [email protected].
Platts will publish monthly updates via press release on Bakken and Eagle Ford shale oil production and price data.
Visit this link to see the Platts May 2014 special report: Bakken: The King in the North.
* The Bakken formation spans North and South Dakota, Montana, Saskatchewan, Manitoba and Alberta.
** API gravity is a measure of how heavy or light a grade of crude oil is compared to water.
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