U.S. oil production may rise to as much as 14 million barrels of oil per day (bpd) by 2020, Secretary of the Interior Ryan Zinke told Fox Business on Wednesday.
“Today we are the largest oil and gas producer on the face of the planet, rolling through 11.2 million bpd, on our way to 14,” Secretary Zinke said.
There are some hurdles, we have to get the infrastructure, but the production side of it is well within the capability of going to 14 million bpd, he added.
In its October Short-Term Energy Outlook (STEO), the Energy Information Administration (EIA) said that U.S. crude oil production averaged 11.1 million bpd in September, up slightly from the oil production in August. The EIA expects U.S. crude oil production to average 10.7 million bpd this year, rising from 9.4 million bpd in 2017. U.S. oil production will average 11.8 million bpd in 2019, EIA’s latest estimate shows.
U.S. production is and will continue to be driven by the shale patch, most notably the Permian, although takeaway capacity constraints are slowing down the growth and widening the differential of WTI to Brent.
The seven key shale regions are expected to boost their oil production in November by 98,000 bpd from October to a combined 7.714 million bpd, with the Permian alone adding 53,000 bpd of production next month compared to this month, the EIA forecasts. Related: The Dark Horse Of The Oil Price Rally
For exports, U.S. crude oil exports could increase to 3.9 million bpd by 2020, up from just above 2 million bpd now, mostly driven by rising production in the Permian, the Houston Chronicle reported earlier this month, citing a report by S&P Global Platts.
However, the Permian production has already outpaced pipeline takeaway capacity capable of transporting the crude oil to the Texas Gulf Coast. Midstream operators have planned and continue to announce plans for more oil pipeline projects in the area to ship oil from the Permian to the Gulf Coast. But many of those pipelines will not come on stream before late in 2019 and 2020, creating bottlenecks in the flow of the rising oil production to the Gulf Coast for exports.
By Tsvetana Paraskova for Oilprice.com
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