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Shale Play Production Declines Steeper in December, EIA Predicts

Total natural gas and oil production from the nation's seven largest unconventional plays, which has been on a mild downturn since April, will decline more steeply next month compared to November, the Energy Information Administration (EIA) said.

Total natural gas production from the plays will be an estimated 44.29 Bcf/d in December, a 394 MMcf/d decline from 44.68 Bcf/d this month, EIA forecast in its latest Drilling Productivity Report (DPR).

The Marcellus Shale will be responsible for the bulk of the decline, with EIA estimating 15.66 Bcf/d coming out of the play in December, compared to 15.89 Bcf/d in November. Also expected to see month-to-month declines are the Bakken (1.57 Bcf/d, compared to 1.59 Bcf/d in November), the Eagle Ford (6.53 Bcf/d, compared to 6.69 Bcf/d) and the Niobrara (4.18 Bcf/d, compared to 4.24 Bcf/d). The Haynesville is expected to remain unchanged at 6.36 Bcf/d, and two plays are forecast to see production increases: the Permian Basin (6.85 Bcf/d in December, compared to 6.84 Bcf/d a month earlier) and the Utica Shale (3.13 Bcf/d, compared to 3.07 Bcf/d).

EIA also expects slight declines in oil production, with the seven-basin total for December estimated at 4.95 million b/d, compared to 5.07 million b/d in November. Oil production will be lower in five basins: the Bakken (1.11 million b/d, compared to 1.13 million b/d in October), Eagle Ford (1.28 million b/d, compared to 1.36 million b/d), and Niobrara formation (356,000 b/d, compared to 378,000 b/d), along with marginal declines in the Haynesville and Marcellus. Oil production is expected to increase in the Permian Basin (2.02 million b/d, compared with 2.01 b/d in November) and will be up marginally in the Utica, EIA said.

EIA released the first DPR more than two years ago (see Shale Daily, Oct. 22, 2013) but didn't forecast month-to-month declines until seven months ago (see Shale Daily, Sept. 15; April 13).

The productivity of new wells in the plays is expected to remain virtually unchanged in December, EIA said. On a rig-weighted average basis, new-well gas production per rig in the plays will be a combined 2.43 MMcf/d in December, compared to 2.42 MMcf/d this month, and new-well oil production per rig will be 473 b/d, compared to 466 b/d this month.

EIA revised the Utica and Marcellus rig count for the latest DPR "due to improperly accounting for four Ohio counties, which had been assigned to the Marcellus region in the calculation of average rig productivity. The revised data increase the rig count in Utica and decrease the count in Marcellus by the same amount. The result mostly affects the rig productivity calculation, but the production forecast is affected as well," EIA said. The same change had been noted in last month's DPR (see Shale DailyOct. 13).

EIA also revised downward Marcellus liquids production to align the West Virginia crude oil production volumes to production data reported on the Form EIA-914 survey.

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