Craddick bullish on oil, gas industry future
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Craddick was the keynote speaker Wednesday at the Texas Alliance of Energy Producers Expo & Annual Meeting at the Ray Clymer Exhibit Hall in Wichita Falls.
The commissioner said Texas oil and gas producers continue to lead the charge in the country’s energy sector, including pulling 2.5 million barrels of oil per day out of the ground. She said those numbers are similar to the amount produced in 1972.
“We are producing at all-time highs,” Craddick said. “We’re producing 30 percent of the country’s oil — the country is producing 9.3 million barrels of oil per day. We’re also producing about 20 (billion cubic feet) of natural gas a day out of the state of Texas.”
The downside, Craddick said, is that the numbers haven’t decreased much over the past six months or so, which is contributing to oversupply problems and low prices.
She said that about 350 rigs are in operation in the U.S., with about 200 of them in Texas. The Texas figure still is good news, she said, because that means the state still is producing.
“It also means that we’re part of the conversation for the first time,” Craddick said. “If you look to what happened even on Sunday, OPEC can’t figure it out, folks. Why? We’re now the producer. We know how to produce, we know how to do it with new technology — innovation comes out of this state and out of this country, and OPEC doesn’t control the price of oil anymore.”
Craddick said challenges are ahead for the state and industry, but the RRC is working diligently to put the best practices in place to continue leveraging Texas’ oil and gas production. Such practices include relatively new rules such as casing wells, recycling water during production, and vertical and horizontal drilling.
The oil and gas industry continues to be an important part of the state and national economy, she said, pointing to specific areas such as the Barnett and Eagle Ford shales and the Permian Basin. Although activity in the Barnett Shale isn’t as active as it was a few years ago, the other two still are chugging along, Craddick said.
The Eagle Ford Shale, the largest field in the Lower 48, had more than $28 billion in investments in 2015, and more than 2,500 drilling permits were issued by the RRC. Five of the most productive Texas counties are located in that formation in central and south Texas.
“The Permian Basin is unique because if you look at any play across this country, and you’ve got one zone that’s 200-300 feet and that’s the sweet spot,” Craddick said. “If you look at the Permian Basin, there are 10-14 plays stacked on top of each other. We have just started out there, and horizontal drilling, hydraulic fracturing just got to the Permian Basin.”
She said other challenges include production of pipeline for infrastructure, attracting and hiring new people at the RRC, and fending off a federal government that has created rules that will affect the pocketbooks of Texans.
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