Natural gas production in August in the Lower 48 states of 65.79 Bcf/d marked a 1.8% increase over July and nearly a 5% increase over August a year ago, the Energy Information Administration (EIA) said in its monthly report. Production from the federal offshore Gulf of Mexico (GOM) advanced for the first time in six months.

Total Lower 48 production has posted fairly steady gains since August a year ago when it was 62.83 Bcf/d, according to EIA. There was some question about the future strength of the trend, however, since a survey of gas well completions over the first three quarters of 2010 by the American Petroleum Institute (API) showed a 3% drop over the same period in 2009.

GOM production was up 6.4% in August over July, going from 5.82 Bcf/d to 6.19 Bcf/d, EIA said. Gulf output had been sliding since it registered 680 Bcf/d in February. Offshore production a year ago in August was 6.86 Bcf/d.

All other reporting areas in the Lower 48, except Oklahoma, posted gains.

Louisiana production in August of 6.43 Bcf/d represented nearly a 50% jump over year-ago August production of 4.33 Bcf/d. Louisiana’s August production was up by 3.4% or 0.21 Bcf/day over July, led by new wells coming online in the Haynesville Shale and other areas of the state, EIA said.

Texas, the largest producer, gained only 0.4% over the previous month, producing 20.64 Bcf/d. Texas production has been hovering just above and below the 20 Bcf/d mark for the last year.

Wyoming production was up 1.5% over the previous month to 6.83 Bcf/d, on par with its production a year ago. New Mexico gained 0.3% over July 2010 to 3.80 Bcf/d, but slipped from 4.01 Bcf/d during August 2009. Oklahoma was down 0.2% from July 2010 to 5.02 Bcf/d, which was also below the year-ago total of 5.13 Bcf/d.

Production from all other states in the Lower 48 was up 2.4% from July 2010 to 16.88 Bcf/d in August 2010, which was also nearly a 13% increase from August a year ago when production was 14.97 Bcf/d. The EIA monthly report included slightly revised figures for July 2010.

Well completions are on an upswing from levels of last year, API said, but with activity targeting oil rather than natural gas charting the largest gains.

An estimated 11,297 oil and natural gas wells and dry holes were completed in the third quarter, a 45% jump from last year’s third quarter, according to API’s 2010 Quarterly Well Completion Report: Third Quarter. The activity increase continues the trend noted in API’s second quarter report (see NGI, July 19).

An estimated 4,434 gas wells were completed in the third quarter, a 28% increase from 2009’s third quarter. But, for the first three quarters of the year estimated gas well completions dipped 3% from a year ago to 12,677, while oil well completions rose 21% to an estimated 13,865. API estimates showed a resurgence in oil well completion activity in the third quarter, with completions rising to an estimated 5,451 oil wells, a 60% jump from year-ago levels.

API also reported total estimated footage of 69,156,000 feet drilled in the third quarter, a 43% increase from third quarter 2009. Oil well footage surged 81% for the quarter, to 32,815,000, while natural gas footage gained 17% to 29,255,000.

For most of this decade, natural gas had been the primary target of domestic drilling, API said, but with the continued growth of oil well completions and a drop in natural gas completion activity this year amid historically low natural gas prices, this is no longer the case.

However, exploratory gas wells continued to trend up in a big way. “Third quarter exploratory well completions climbed 31% compared with 2009’s third quarter, with natural gas exploratory wells up a whopping 68%,” said Hazem Arafa, director of API’s statistics department. “I think this really demonstrates the oil and natural gas industry’s continued commitment to finding new energy sources to meet growing U.S. and world demand, as well as the importance of new supply areas, many of which were only opened recently thanks to the industry’s ability to apply innovative techniques to existing technologies.”

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