Shale Industry Suffering From Unexpected Operational Problems
Shale wells typically see their production levels decline rapidly after an initial burst of output. Unlike a conventional oil field, which usually enjoys relatively stable production for years, output from a single shale well can fall off drastically within months. More shale wells need to be drilled just to keep production flat.
In the Permian, the rate of decline has accelerated recently. The decline from legacy wells, which are already in production, has grown dramatically in 2017. In September, according to the EIA, the Permian will see production from legacy wells fall by 158,000 barrels per day (b/d) month-on-month. That means that the shale industry will need to add at least as much new supply just to hold steady. That decline rate is 40 percent larger than a year earlier. Across the top shale basins in the U.S.—the Bakken, Eagle Ford, Haynesville, Marcellus, Niobrara, Permian and Utica—the decline of oil output from legacy wells will have jumped by about 25 percent from September 2016 to around 400,000 b/d for the same month this year, according to the EIA. |
