EIA:Per capita CO2 emissions from primary energy consumption decreased in every state from 2005 to 2023, according to recently released data in our State Energy Data System. Total energy-related CO2 emissions in the United States fell 20% over that time, and the population grew by 14%, leading to a 30% decrease in per capita CO2 emissions.
The EIA reports an 8% increase in 2023 US associated gas production as crude oil production rose to record levels. The Permian Basin, the dominant US crude oil producer, is unsurprisingly the leading associated gas producer.
EIA’s analysis inexplicably ignores the Gulf of Mexico OCS. The Gulf produced an average of 1.64 bcf/d of casinghead (associated) gas in 2023, ranking the GoM just behind the Eagle Ford and significantly above the Niobrara and Anadarko regions (see chart above). It’s also noteworthy that most production from the regions on the EIA chart is from private land, and is not constrained by 5 year leasing plans and other restrictive Federal policies.
80% of GoM gas production is from deepwater leases. The % of associated gas produced on deepwater leases is even higher. The 2 leading GoM gas producers, Shell and bp, only operate deepwater leases. The % of their 2023 gas production that was associated gas was 93% for Shell and 100% for bp.
Gulf of Mexico 2023 oil production has dipped over the past 2 months, and is down 10% since January.
2023 production is reasonably well aligned with the EIA forecast which shows new production being offset by declines in existing fields.
Last year, BOEM forecast that production would average 2.0 million bopd in 2023. That forecast was justification for curtailing BOEM’s Proposed 5 Year Leasing Program. For the first time in the history of the OCS program, the primary concern of the program managers was that production might be too high for too long! This stunning quote from the 5 year leasing plan explains why so few lease sales were proposed:
“BOEM’s short-term (20-year) production forecast for existing leases shows steady growth from 2022 through 2024 and declining thereafter (see Section 5.2.1). The long-term nature of OCS oil and gas development, such that production on a lease can continue for decades makes consideration of future climate pathways relevant to the Secretary’s determinations with respect to how the OCS leasing program best meets the Nation’s energy needs.“
According to EIA data for 2001-2021, Gulf of Mexico flaring and venting volumes peaked in 2001 at 21.6 bcf, 2.25 times the volume flared or vented in 2022 (ONRR data for 2022). However, gas production in 2001 was 5.05 tcf, 6.4 times higher than in 2022. The % of the produced gas that was flared or vented in 2001 was thus 0.4%, less than 1/3 the 2022 rate of 1.22%.
Points to consider:
In 2001, gas production was mostly from gas wells, which have lower flaring/venting rates. As gas production declined because of lower gas-well gas (GWG) production, flaring/venting rates increased (see the chart below). This would account for some of the difference in flaring/venting rates (2001 vs. 2022). However, in recent years, the % of gas-well gas flared or vented has been between 0.3 and 0.5% which is comparable to the rate for all gas production (0.4%) in 2001. So the reduction in GWG production is not the entire reason for the higher flaring/venting rates in recent years. Hence the need for more transparency on flaring/venting performance.
Oil-well gas (OWG) production alone in 2001 (923 bcf) was higher than total gas production (784 bcf) in 2022. If the oil-well gas (OWG) flaring/venting rate was the same as the recent rate for OWG (1.2-1.5%), the volume of gas flared or vented from OWG alone (only 18% of total gas production in 2001) would have accounted for 11.1 – 13.8 bcf or 51-64% of the total volume flared/vented in 2001.
Yesterday, Lars Herbst attended the EIA’s Annual Energy Outlook presentation. The slides are attached.
Below is a custom chart from the EIA data tables. While EIA predicts growth in renewable generating capacity, US oil and gas production are nonetheless projected to increase slightly through 2050.
The EIA 2022 figure is spot-on, as it should be given that 10 months of 2022 production data are now in hand. However, BOEM’s 2022 forecast (published in July) missed the mark considerably. (In fairness to BOEM staff, their work was probably completed months before publication pending internal reviews.)
Of greater concern, given the policy implications, is the rosy BOEM forecast for the out-years. Despite historically low levels of leasing and exploratory drilling, BOEM forecasts oil production to exceed 2 million BOPD through 2027 and to remain well above the current (2022) level through 2031 (second table below).
In our September Short-Term Energy Outlook (STEO), we expect natural gas consumption to increase by 3.6 billion cubic feet per day (Bcf/d) in the United States during 2022 to average 86.6 Bcf/d for the year, the most annual U.S. natural gas consumption on record. We forecast that U.S. natural gas consumption will increase in all end-use sectors this year. We expect the U.S. electric power sector to grow by 4% in 2022 to 32.1 Bcf/d, exceeding the 2020 record by 1%, which is the highest growth rate among all sectors.