Wednesday, September 27, 2006

EIA's Natural Gas and Oil Reserves' Annual Report

The Energy Information Administration recently released an Advance Summary of U.S. Crude Oil, Natural Gas, and Natural Gas Liquids Reserves - 2005 Annual Report (PDF). Here's are some highlights:

Reserves additions replaced 164 percent of 2005 dry natural gas production as U.S. natural gas proved reserves increased for the seventh year in a row according to estimates released today by the Energy Information Administration. The 6 percent increase in 2005 was the largest annual increase in natural gas proved reserves since 1970.

Reserves additions of crude oil replaced 122 percent of the 2005 production. Crude oil proved reserves went up in 2005 for the first time in 3 years, increasing by 2 percent. Two of the four largest U.S. oil-producing areas, Texas and California, reported increases in proved crude oil reserves in 2005 while the Gulf of Mexico Federal Offshore and Alaska reported declines.

U.S. crude oil production declined in 2005 due to lower production in the Gulf of Mexico and Alaska. The Rocky Mountain States, however, generally increased their crude oil production in 2005 with Montana showing the largest increase at 36 percent owing to development of the Bakken Formation in the Williston Basin.

Gas reserves additions onshore in the lower 48 States were large enough to overcome a 10 percent drop in gas reserves reported for the Gulf of Mexico Federal Offshore. The majority of natural gas reserves additions in 2005 were extensions of existing gas fields rather than new field or reservoir discoveries.

Total U.S. natural gas production declined 4 percent in 2005 due to the effect of Hurricanes Katrina and Rita which cut natural gas production in the Gulf of Mexico (which had accounted for 20 percent of U.S. dry gas production in 2004) by 80 percent at the peak of hurricane-related curtailments. Gulf of Mexico production slowly returned and is expected to reach roughly 90 percent of 2005's pre-hurricane production rate in September 2006. Gas production from the Gulf had been declining at about 10 percent per year prior to the hurricanes.

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