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EIA Expects Big Seven NatGas, Oil Production to Fall Through May

Oil and natural gas production from the nation's seven most prolific shale and tight oil plays, which has been on the march for months, is expected to decline in May, according to the Energy Information Administration (EIA).

Total natural gas production from the seven plays analyzed in the agency's Drilling Productivity Report (DPR) is projected at 45.97 Bcf/d in May, compared with 45.99 Bcf/d this month, EIA said.

The Marcellus Shale is expected to produce 16.72 Bcf/d, up marginally from 16.71 Bcf/d in April. Also expected to show increases are the Haynesville (7.16 Bcf/d, up from 7.12 Bcf/d), the Utica Shale (2.01 Bcf/d, up from 1.97 Bcf/d) and the Permian (6.44 Bcf/d, up just 4 MMcf/d).

Those increases will be outweighed by projected declines registered in three other plays, EIA said. The Niobrara's output is expected to fall to 4.63 Bcf/d next month, compared with 4.68 Bcf/d in April. Production from the Eagle Ford in May will be an estimated 7.49 Bcf/d (compared to 7.53 Bcf/d in April) and the Bakken will produce 1.53 Bcf/d (compared to 1.55 Bcf/d in April), the agency said.

Those same basins will also see declines in oil production, according to EIA's forecast. The agency expects production to decrease month-to-month in the Bakken (1.30 million b/d in May, compared with 1.32 million b/d this month), Eagle Ford (1.69 million b/d, compared with 1.72 million b/d) and Niobrara (403,000 b/d, compared with 417,000 b/d), while two plays -- the Haynesville and Marcellus -- are projected to remain unchanged at 58,000 b/d and 57,000 b/d, respectively.

Only the Permian (1.99 million b/d in May, compared with 1.98 million b/d in March) and Utica (64,000 b/d, compared with 62,000 b/d) will see oil production increases, EIA said.

Total oil production from the big seven plays in May will be an estimated 5.56 million b/d, compared with 5.62 million b/d in April, according to the agency.

It's the first time the agency has forecast month-to-month declines since it released the first DPR 18 months ago (see Shale DailyOct. 22, 2013). At that time, the DPR covered six plays/regions: the Bakken, Niobrara, Permian, Eagle Ford, Haynesville and Marcellus. The Utica Shale was added to the report last year (see Shale DailyAug. 1, 2014).

The agency continues to report increasing productivity of new wells in the plays. New-well gas and oil production is expected to be higher in May than in April across the big seven (except for oil production in the Marcellus, which will remain unchanged). On a rig-weighted average, new-well gas production per rig in the plays will be a combined 2.14 MMcf/d in May, compared with 1.02 MMcf/d this month, and new-well oil production per rig will be 387 b/d, compared with 374 b/d this month.

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