Discussed a superb report from UT San Antonio about the economic impact of the Eagle Ford Shale play here. That new field with very new drilling is having a huge impact on the regional economy.
Update 10-13-12: I have dramatically revised the analysis presented here. I don’t understand the amounts mentioned in the EIA report, particularly when compared to actual production data reported for July. In another post located here, I’ve revised my analysis to show that the July production is generally on track with the moderate scenario forecast. Etiquette rules for blogging and the rules I follow on my blog call for leaving the original comments in place and noting corrections. (That means I don’t do the memory hole routine.) Instead of doing a massive rewrite of this post, I have another post for an update: What’s the production level in Eagle Ford and how does it compare to some recent forecasts?
Update 2: Just in case it isn’t obvious, I continue to be amazed at the Eagle Ford field. It is a game changer nationally and internationally. You really ought to check out the research report. It is superb.
The report has great analysis of the impact on jobs, payroll, and sales tax revenue in the region. The authors have forecasts of production in 2021 and lots of data for the last few years. The report is Economic Impact of the Eagle Ford Shale. I’m neither an economist nor academician, so I can’t appreciate some of the details they have present, but they sure did ‘show their work’ as your high school algebra teacher would say, through footnotes and listing assumptions & formulas for their calculations.
As I wrote my previous post though, I realized something didn’t look right.
Here’s the fantastically wonderful problem. Expected production in April 2012 for gas & condensate is at the level they forecasted for 2014. Expected gas production is at the level projected in 2017.
Let me explain –
EIA reports the expected production of oil and condensate is expected to hit 500,000 barrels per day in April. Looking at Eagle Ford Shale blog confirms I’m reading that stat right.
That would be 182.5 million barrels a year.
Going to page 70 of the UTSA report shows that the moderate scenario projects 106.2 million bbls oil and 79.1M bbls of condensate, for total of 185.3M bbls in 2014. So the projected oil & condensate production in April 2012 is already at the rate of production for 2014 in the moderate forecast.
The same post from Eagle Ford Shale says the gas production has passed 2 Bcfd. That would be around 730 Bcfd annually.
Back to page 70 of the UTSA report.
The moderate forecast has production of 707 Bcfd in 2016 and 754 Bcfd in 2017. So current production is at the rate forecast for early 2017.
The UTSA report is great. I had a blast browsing through it.
It is, however, delightfully out of date the same week that it was released.
Wonder what the high range data looks like? Wonder how soon the production will blast past that?
My point is things are moving blindingly fast. Way cool.
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