Eagle Ford Production has outpaced expectations for five years and it should be no surprise if the area eventually produces more than 2 million barrels of oil per day.
It's hard to comprehend the full context of the previous statement, so let me state it another way. If the Eagle Ford eventually produces between two and three million barrels of oil per day, the play by itself could land in the list of the top 10 oil producing countries in the world. The entire world produces just under 90 million barrels of oil per day.
Most research organizations predict production will reach between 1.6 and 2 million b/d sometime between 2017 and 2020. Recent results in the Buda and Austin Chalk make it easy to see how the area could produce much more if other formations prove commercial. Add the Permian Basin, where Texas is experiencing similar growth, and the state is closing in on Mexico as the third largest producer in North America (behind the U.S. and Canada)
Eagle Ford Oil Production Expected to Eclipse 1 Million b/d in 2014
Eagle Ford oil production is nearing 700,000 b/d and Eagle Ford condensate production measured at the wellhead has surpassed 200,000 b/d. Add condensate that falls out further downstream and the play is close to reaching 1 million b/d of total oil and condensate production.
The EIA's most recent drilling productivity report proclaimed the Eagle Ford has already surpassed 1 million b/d of oil production, but the agency is counting both oil and condensate from the entire region. Most analysts are predicting the play will reach the million barrel benchmark for oil only sometime in 2014.
If the whispers we're hearing about capital budgets in 2014 are true, the play will likely surpass the 1 million b/d mark in the first half of the year.
North America Is Becoming More Important in the Global Oil Market
Watch the video depicting North America oil production over the past 30 years below. There's not a whole lot of change until the last few years and that has been magnified in 2013. The Bakken and Eagle Ford are nearing 1 million b/d and the Permian Basin has already surpassed that mark.
The Eagle Ford Influences the Natural Gas Market
Eagle Ford natural gas production is approximately 3 Bcf/d or 5% of onshore production in the contiguous states. That's no small feat for an oil play. Natural gas prone portions of the play provide additional opportunity if prices improve to more than $4/mcf in the coming years.
The Eagle Ford is best in class when it comes to shale plays. Great economics combined with access to the Gulf Coast industrial complex provide a strategic advantage not matched by any play in the world. Watch for the Eagle Ford to continue driving the economy in South Texas even if oil prices drop as much as 20%.