New techniques are sucking oil faster than ever
There are two factors in oil production: 1) How much oil is in the ground, and 2) how fast you can get it out.
Shale fracking technology unlocked oil that was previously extractable. It opened up vast reserves in the US and elsewhere.
Tapping that has led to a boom in US production that pushed it to levels not seen in more than 40 years.
Looking at the chart, note the recent jump above 10 million barrels per day. That could be just a sign of what’s to come.
The first stage of shale was figuring out how to get it out of the ground, now the challenge is getting it out faster.
Today Bloomberg writes about what Encana is doing in West Texas. instead of using a rig to plumb a certain depth for shale, then relocating, they’re doing something called ‘cube development’ where they drill and extract at multiple levels all at the same time.
Proponents say the technique creates economies of scale that drive down the costs of shale. Encana said in November that per-well costs dropped by a quarter.