Data just coming in from 2011 shows that investment in U.S. shale oil and gas drilling nearly doubled over 2010 levels, which vaulted shale plays to account for nearly one-quarter of all wells drilled in the United States, according to the American Petroleum Institute (API).
In API's 2011 Joint Association Survey on Drilling Costs, which was released on Monday, the institute found that an estimated $65.5 billion was invested, drilling an estimated 10,173 U.S. shale oil and natural gas wells in 2011. The investment represents an 87.6% increase in shale drilling expenditures from 2010 levels and more than half of an estimated $124.8 billion spent on all new wells drilled in 2011. The number of estimated shale wells drilled in 2011 is 43.8% more than in 2010.
"The rising numbers illustrate the growing importance of shale drilling in U.S. oil and natural gas development," said Hazem Arafa, API statistics director. "Shale drilling drove most of the overall increase in drilling and now accounts for an estimated 23% of all wells drilled in the United States."
Shale development's slice of the total pie is rising significantly. The report shows that while expenditures on shale drilling were barely more than one-fourth of expenditures for drilling of all wells in 2009, they accounted for more than half of total well drilling expenditures in 2011.
The survey also revealed that estimated expenditures for offshore drilling dipped precipitously from 2009 to 2010, from an estimated $24.9 billion to $4.0 billion, which API points out is due at least in part to the drilling moratorium put in place by the Obama administration following the Macondo well blowout in the Gulf of Mexico. Expenditures increased to an estimated $8.1 billion in 2011.
The number of estimated shale wells rose rapidly, increasing 84% over only three years, from 5,531 in 2009 to 7,077 in 2010 to 10,173 in 2011. The survey also showed that almost twice as many shale gas as shale oil wells were drilled in 2011, 6,759 versus 3,414. Wells drilled of all kinds totaled 44,160 in 2011.