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EIA Expects Further Decline in Shale Production Next Month

Natural gas and oil production from the nation's seven largest unconventional plays in January is expected to compare with this month, despite colder weather and improving rig efficiency, the Energy Information Administration (EIA) said.

Total natural gas production from the plays will be an estimated 43.96 Bcf/d in January, a 365 MMcf/d decline from 44.32 Bcf/d this month, EIA forecast in its latest Drilling Productivity Report (DPR).

EIA estimated that the Marcellus Shale will produce 15.45 Bcf/d, compared with 15.66 Bcf/d this month, and the Eagle Ford 6.41 Bcf/d in January, compared with 6.58 Bcf/d. Also expected to see declines in January are the Bakken Shale (1.56 Bcf/d from 1.58 Bcf/d) and Niobrara formation (4.11 Bcf/d from 4.17 Bcf/d). Those declines will more than offset upticks in the Haynesville Shale (6.34 Bcf/d in January, compared with 6.31 Bcf/d this month), Permian Basin (6.89 Bcf/d, compared with 6.88 Bcf/d) and Utica Shale (3.21 Bcf/d, compared with 3.14 Bcf/d).

EIA also expects slight declines in oil production, with the seven-basin total for January estimated at 4.86 million b/d, compared to 4.98 million b/d in December. Oil production will be lower in five basins: the Bakken (1.10 million b/d, compared to 1.13 million b/d in December), Eagle Ford (1.20 million b/d, compared to 1.28 million b/d), and Niobrara (344,000 b/d, compared to 368,000 b/d), along with marginal declines in the Haynesville and Marcellus. Oil production is expected to increase in the Permian Basin (2.04 million b/d, compared with 2.02 b/d in December) and will be up marginally in the Utica, EIA said.

EIA released the first DPR more than two years ago (see Shale DailyOct. 22, 2013) but didn't forecast month-to-month declines until earlier this year (see Shale DailySept. 15April 13).

The productivity of new natural gas wells in the plays is expected to increase slightly in January, EIA said. On a rig-weighted average basis, new-well gas production per rig will be a combined 2.52 MMcf/d next month, compared to 2.45 MMcf/d in December. New-well oil production per rig will be 492 b/d, a slight decline compared to 495 b/d this month, according to the DPR.

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