Report: Oil and Gas Reserves Growth Fastest on Record
Subscribe today for Free Enterprise Updates
- Latest business trends and best practices
- News about legislation and regulation impacting business
- Business how-to articles from industry experts
- Commentary and interviews with newsmakers in business and politics
We know shale energy has been booming across the country, but a new Energy Information Administration (EIA) report finds that unconventional energy development has driven an amount of growth in U.S. proven oil and natural gas reserves never seen in the history of the agency.
According to data recently compiled for 2010, proven oil reserves rose by 12.8%, and proven natural gas reserves rose by 12%.
EIA defines “proven reserves” as “those volumes of oil and natural gas that geologic and engineering data demonstrate with reasonable certainty to be recoverable in future years from known reservoirs under existing economic and operating conditions.”
Innovations in the energy sector have driven much of the proven reserves increase. The report notes [emphasis mine]:
An important factor for each fuel was the expanding application of horizontal drilling and hydraulic fracturing in shale and other "tight" (very low permeability) formations, the same technologies that spurred substantial gains in natural gas proved reserves in recent years.
In oil exploration, rigs drilling horizon nearly tripled in 2010 and made up 44% of all active rigs. Texas added 860 million barrels to its reserves, and North Dakota followed closely with a 829 million barrel increase in 2010.
In the natural gas space, hydraulic fracturing boosted reserves in shale formations in Texas, Louisiana, Arkansas, Oklahoma, and Pennsylvania.
There were relatively few heavy-handed attempts to needlessly expand federal regulations on shale energy development while these reserve increases took place--despite EPA's efforts. I don’t think that’s a coincidence. This EIA report is an indication that innovation combined with sensible state-level regulation is allowing the energy industry to tap into more of America’s domestic resources. Given the increase in exploration activities we’ve seen in 2011 and 2012, we should expect to see these reserve estimates continue to increase significantly. Shale does Work for US.