Do You Live in a Top-5 Oil-Producing State?
Mar 19th 2013 12:36PM
Updated Mar 19th 2013 1:02PM
Yesterday, the Energy Information Administration, or EIA, published a brief post about North Dakota's continued growth in oil production. The state routinely makes headlines for its black gold, low unemployment, and lack of available real estate. All of the talk about North Dakota makes now a good time to step back and look at how the oil story is progressing in the rest of the United States' top oil-producing states: Oklahoma, Alaska, California, and Texas. Together they produce more than 60% of all of America's oil.
First, some stats
The U.S. produced roughly 7.03 million barrels of oil per day by the end of last December. It is important to note that the EIA's definition of crude oil may not match exactly with another nation's definition of crude oil.
Of that 7.03 million bpd, Texas produced 2.22 million bpd to take the title of top oil-producing state. Here is how the other states shake out:
It is important to remember that despite all of the hoopla over U.S. production, Alaska and California have both watched their oil production decline over the last five years.
The Sooner State was averaging 262,000 barrels per day by the end of last year. Oil producers there focus on the Mississippi Lime formation, and are now beginning to target the thicker layers of the Woodford Shale. The Woodford was traditionally a gas play, but companies like Continental Resources are targeting certain sections hoping to find oil instead. Continental increased its acreage in the play 113% last year.
Oklahoma was voted the No. 1 place in the world for oil and gas investment by the Fraser Institute last year.
From an outsider's perspective, California has arguably the most interesting oil history of any of the states on this list. Battles over black gold and pollution, an on-again, off-again offshore policy, and historic oil spills help explain why the state's production continues to decline in the face of what some are calling unprecedented reserves. California is home to the Monterey Shale, which many -- including the federal government -- believe holds up to 15.4 billion barrels of crude oil. The geology is tricky in California, and as oil companies try to figure out the play's true potential some, like Chevron, have already written it off.
Production in our northernmost state has been falling for quite some time, dropping 7.3% two years ago, and 6.7% last year. Alaska is home to Prudhoe Bay, the nation's largest oil field. Prudhoe is old and tired, and though BP has worked wonders getting it to produce far longer than most anticipated, it is not the field it once was. In an attempt to entice oil producers to reinvest and spur production increases again, Alaskan governor Sean Parnell is attempting to introduce legislation to cut taxes on oil producers by some $1.7 billion. ConocoPhillips and ExxonMobil also have a large presence in the state.
2. North Dakota
Ninety-five percent of North Dakota's oil is produced via horizontal drilling and hydraulic fracturing. The Bakken Shale has single-handedly pushed the state up the ranks of the oil producers. Last year, North Dakota passed both Alaska and California on its way to second place, and though it is still far behind Texas, it's growth has been incredible in such a short period of time, though there are concerns about the decline rates of Bakken wells. The EIA estimates that production averaged about 770,000 barrels per day (including lease condensate) by the end of 2012. The top producers in the state are Continental Resources and Hess .
No surprise here. Texas has long been the country's top oil producer. Though it is still off its record numbers from the 1970s, Texas is in the midst of a one heck of an energy renaissance. Between the developing shale plays and the reinvigorated vertical wells in West Texas' Permian Basin, and the emergence of the Eagle Ford Shale in East Texas, the state is head and shoulders above all other U.S. oil producers. The top producers in Texas are Occidental Petroleum and EOG Resources . As recently as last year, Kinder Morgan was the second-highest producer in the state, which goes to show how quickly the story can change.
Technology has completely changed the oil production game in North Dakota. The state features growing oil production and the nation's lowest unemployment rate, contrasting sharply with California's declining oil production and the nation's highest unemployment rate. Technology has also reinvigorated the oil game in Texas, serving as an example to California and Alaska that there could theoretically be more oil in their futures as well.
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The article Do You Live in a Top-5 Oil-Producing State? originally appeared on Fool.com.Fool contributor Aimee Duffy has no position in any stocks mentioned. The Motley Fool recommends Chevron. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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