Govt. says Gulf, N. Dakota drilling boosted US oil production in 2009 for 1st time since 1991

Govt. says US oil production increased in 2009

CHEYENNE, Wyo. — Increased crude oil production in the Gulf of Mexico and North Dakota more than offset declines elsewhere last year to result in the first annual increase in U.S. oil production since 1991, according to the U.S. Energy Information Administration.

Domestic oil production in 2009 averaged 5.32 million barrels a day, up 7.4 percent from 4.95 million barrels a day in 2008, according to the federal agency’s Short-Term Energy Outlook report for March.

Last year saw the highest level of domestic oil production since 2004, when the daily average was 5.42 million barrels. Production had been declining steadily since 1991’s daily average of 7.42 million barrels.

The report forecasts production to continue growing for at least the next couple years, with increases of 3.9 percent predicted in 2010 and 0.3 percent in 2011.

Last year’s increase resulted mainly from drilling investments made by energy companies before prices collapsed in 2008, said Tancred Lidderdale, an analyst in the Energy Information Administration, part of the U.S. Department of Energy.

The federal deepwater reserves in the Gulf of Mexico have been known about for years but only last year were sufficiently tapped to significantly boost production.

“It takes anywhere from five to 10 years to develop new deepwater, offshore fields,” Lidderdale said Wednesday.

Through October, the most recent month for most specific data, federal deepwater production in the gulf was up 30 percent, an increase of 107 million barrels, compared with the first 10 months of 2008.

In North Dakota, production was up just under 30 percent, or 15 million barrels, over the first 10 months of 2009. Most came from the Bakken shale in the western part of the state.

New drilling technologies such as improved methods of hydraulic fracturing — pumping a pressurized mixture of water and chemicals underground to split rock — have enabled production in the previously unproductive formation.

Higher oil prices starting around 2004 spurred the kind of investment that made developing areas like the Bakken feasible, said Rayola Dougher, senior economic adviser for the American Petroleum Institute.

“As the price of oil went up, you were able to access resources that were more difficult and expensive to get to,” Dougher said.

Other major oil-producing states with increased production through October included Louisiana, up 0.85 percent; Oklahoma, up 3.25 percent; Mississippi, up 4.27 percent; and Utah, up 5.9 percent.

Production declined in several other states. Among them were Alaska, where production was down 4.5 percent on the North Slope and 5.3 percent elsewhere; Texas, down 3.75 percent; California, down 3.14 percent; Wyoming, down 4.3 percent; Montana, down 12.45 percent; Colorado, down 3.36 percent; and New Mexico, down 0.05 percent.