Yesterday, the Energy Information Administration, or EIA, published a brief post about North Dakota’s continued growth in oil production. The state routinely makes headlines for its black gold, low unemployment, and lack of available real estate. All of the talk about North Dakota makes now a good time to step back and look at how the oil story is progressing in the rest of the United States’ top oil-producing states: Oklahoma, Alaska, California, and Texas. Together they produce more than 60% of all of America’s oil.
First, some stats
The U.S. produced roughly 7.03 million barrels of oil per day by the end of last December. It is important to note that the EIA’s definition of crude oil may not match exactly with another nation’s definition of crude oil.
Of that 7.03 million bp (NYSE:BP)d, Texas produced 2.22 million bpd to take the title of top oil-producing state. Here is how the other states shake out:
It is important to remember that despite all of the hoopla over U.S. production, Alaska and California have both watched their oil production decline over the last five years.
The Sooner State was averaging 262,000 barrels per day by the end of last year. Oil producers there focus on the Mississippi Lime formation, and are now beginning to target the thicker layers of the Woodford Shale. The Woodford was traditionally a gas play, but companies like Continental Resources, Inc. (NYSE:CLR) are targeting certain sections hoping to find oil instead. Continental increased its acreage in the play 113% last year.
Oklahoma was voted the No. 1 place in the world for oil and gas investment by the Fraser Institute last year.
From an outsider’s perspective, California has arguably the most interesting oil history of any of the states on this list. Battles over black gold and pollution, an on-again, off-again offshore policy, and historic oil spills help explain why the state’s production continues to decline in the face of what some are calling unprecedented reserves. California is home to the Monterey Shale, which many — including the federal government — believe holds up to 15.4 billion barrels of crude oil. The geology is tricky in California, and as oil companies try to figure out the play’s true potential some, like Chevron Corporation (NYSE:CVX), have already written it off.
Production in our northernmost state has been falling for quite some time, dropping 7.3% two years ago, and 6.7% last year. Alaska is home to Prudhoe Bay, the nation’s largest oil field. Prudhoe is old and tired, and though BP plc (ADR) (NYSE:BP) has worked wonders getting it to produce far longer than most anticipated, it is not the field it once was. In an attempt to entice oil producers to reinvest and spur production increases again, Alaskan governor Sean Parnell is attempting to introduce legislation to cut taxes on oil producers by some $1.7 billion. ConocoPhillips (NYSE:COP) and Exxon Mobil Corporation (NYSE:XOM) also have a large presence in the state.