Oil production from shale formations in North Dakota and Texas increased by 17,000 barrels per day (b/d), or 1%, in March vs. February, according to Bentek Energy, an analytics and forecasting unit of Platts.
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," Yahya said. "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 US 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 US Gulf Coast logistics.