Half of US Oil Production Comes from These 20 Counties

Posted on April 3, 2014 · Posted in DI Analytics

Top Producing Counties - Areas - 2013 - Fixed - US Oil Production

The 80/20 rule, also known as the Pareto Principle, is a concept used to describe a highly nonlinear relationship between cause and effect. In other words, a minority of the causes (20%) account for a majority of the results (80%).

The spatial distribution of US oil production follows a version of the 80/20 rule. In this case, we’ll call it the 52/2 rule. 52% of all US oil production (as well as 20% of all US natural gas production) in 2013 came from these 20 counties, which make up only 2% of all producing counties.

TopProducingCounties - List - US Oil Production

As you can see from the Type column in the table above, I’m taking some dramatic license with the term county. There are no counties in the Gulf of Mexico (GoM), but the Bureau of Ocean Energy Management, Regulation, and Enforcement (BOEMRE) defines Protraction Areas which subdivide the gulf. Also, most of Alaska is lumped into a single “Unorganized Borough,” so I’m using US Geological Survey (USGS) quadrangles instead (http://ardf.wr.usgs.gov/quadmap.html).

Conventional US Oil Production Tops the List

One surprising result is that, for all the attention unconventional oil production has been receiving, the top four spots all go to conventional production areas in the GoM, Alaska, and California.

  • Three GoM areas make the top 20: Green Canyon (#1), Mississippi Canyon (#4), and Alaminos Canyon (#20). Given the high costs of offshore drilling, these areas are characterized by a small number of wells producing at very high rates.
  • Alaska is represented by two North Slope quadrangles: Beechey Point (#2) and Harrison Bay (#18). North Slope production has been in decline since the late 1980s, so these areas are likely to slip further down the rankings in the years to come.
  • Kern County, California, home to several prolific fields including Midway-Sunset, Kern River, and South Belridge, takes 3rd place. The fact that Kern is near the top of the list is all the more impressive given that some of these fields have been producing for over 100 years.

Unconventional is Coming on Strong

Unconventional areas begin to dominate starting at the 5th spot with McKenzie County, in the heart of the Bakken/Three Forks play.

  • McKenzie, along with neighboring Mountrail (#6), Dunn (#10), and Williams (#12) counties form the core of the Bakken/Three Forks area.
  • The Eagle Ford takes the prize for the play with the most counties in the top 20 with Karnes (#7), LaSalle (#9), Dewitt (#13), Dimmit (#14), Gonzales (#15), and McMullen (#19) counties all making the list. The levels of rig activity in these counties indicate that they will likely rise in the rankings in 2014.

The resurgent Permian Basin is represented by three of the counties on the list: Eddy (#8), Lea (#16), and Andrews (#17). These areas are a mix of legacy conventional production and newly added unconventional production.

Summary

This list illuminates where American oil production is currently coming from, both across the country and within the key producing areas. It is striking that so much of our production comes from a relatively small geographic space. We can expect this list to continue to change in 2014 as unconventional areas continue to ramp up, while some older areas continue their decline.

Your Turn

What do you think? Which of these counties surprised you? Are there areas you think will be on the list in 2014 that didn’t make it in 2013? Leave a comment below.

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Kevin Thuot

Kevin Thuot is an Engineering Research Analyst at Drillinginfo. He is part of the DI Analytics team and focuses on play-level forecasting and operator best practices. His work helps our customers understand how current and future trends in the US unconventional oil and gas industry impact their business. Kevin graduated with a Master’s Degree in Mechanical Engineering from MIT in 2011.