Stronger oil and natural gas prices combined with development of shales and low permeability formations lift U.S. crude oil and natural gas proved reserves to record levels in 2017
Proved reserves of crude oil in the United States increased 19.5% from year-end 2016, rising to 39.2 billion barrels and surpassing the previous peak level of U.S. crude oil proved reserves of 39.0 billion barrels set in 1970. Proved reserves of natural gas increased 36.1% to 464.3 Tcf at year-end 2017 and breaking a 2014 record for total natural gas proved reserves. Both U.S. proved reserves of crude oil and natural gas are approximately double their levels from a decade ago. Stronger oil and natural gas prices combined with continuing development of shales and low permeability formations drove these new all-time record levels of proved reserves according to U.S. Crude Oil and Natural Gas Proved Reserves, Year-End 2017, released today by the U.S. Energy Information Administration (EIA).
The annual average spot price for West Texas Intermediate (WTI) crude oil at Cushing, Oklahoma increased 20% in 2017. On December 29, 2017, the WTI spot price exceeded $60 per barrel for the first time since June 2015. The U.S. total net increase in proved reserves of crude oil and lease condensate was 6.8 billion barrels, or 19.2%, for a total of 42.0 billion barrels. U.S. production of crude oil and lease condensate increased by 6% from 2016.
Producers in Texas added 3.3 billion barrels of crude oil and lease condensate proved reserves, the largest net increase of all states in 2017. This growth in proved reserves was a result of increased prices and development in the Permian Basin of the Spraberry Trend and the Wolfcamp/Bone Spring shale play. The next largest gains in crude oil and lease condensate proved reserves in 2017 were in New Mexico (1.0 billion barrels) and in the Federal Offshore Gulf of Mexico (729 million barrels).
The annual average spot price for natural gas at Louisiana’s Henry Hub increased 21% in 2017. Natural gas spot prices throughout 2017 (at the Henry Hub) did not vary much from the annual average price of $2.99 per million British thermal units (MMBtu). The U.S. total net increase in proved reserves of natural gas was 123.2 trillion cubic feet, or 36.1%, for a total of 464.3 trillion cubic feet. U.S. production of natural gas increased 4% from 2016.
Producers in Pennsylvania added 28.1 Tcf of natural gas proved reserves, the largest net increase of all states in 2017, as a result of increased prices and development of the Marcellus and Utica shale plays. The next-largest net gains in natural gas proved reserves came in Texas (26.9 Tcf) and Louisiana (18.4 Tcf) as a result of development of the Wolfcamp/Bone Spring shale play in the Permian Basin and the Haynesville/Bossier shale play in eastern Texas and northern Louisiana.
The share of natural gas proved reserves from shale increased from 62% of total U.S. natural gas proved reserves in 2016 to 66% in 2017.
Proved reserves are those volumes of oil and natural gas that geological and engineering data demonstrate with reasonable certainty to be recoverable in future years from known reservoirs under existing economic and operating conditions. U.S. Crude Oil and Natural Gas Proved Reserves, Year-End 2017 is available at: http://www.eia.gov/naturalgas/
