New “world-class” oil discoveries have become almost daily occurrences in this era of horizontal drilling and hydraulic fracturing.
Just this week, Oklahoma City-based Continental Resources Inc. said that it has successfully tested the third of four presumably oil-rich rock layers below the now-famous Bakken Shale in North Dakota.
The announcement came shortly after Mexico's state-run oil company PEMEX said it has discovered billions of barrels of recoverable oil in its southern state of Tabasco, two large fields in the Gulf of Mexico and in the portion of the Eagle Ford basin south of the Rio Grande.
Last week, conferences were held in Oklahoma City, Tulsa and Wichita, Kan., to discuss the booming Mississippi Lime play in northern Oklahoma and western Kansas.
Oil producers also recently have boasted about the potential for oil in California's Monterey Shale play. A consultant to Los Angeles-based Occidental Petroleum this week told Environment and Energy Publishing that the California field holds “more oil per square meter ... than any other oil-producing basin on the planet.”
The new discoveries and developments led the U.S. Energy Information Administration on Wednesday to raise its estimates for future domestic oil and natural gas production.
In its Annual Energy Outlook 2013, the government said the country's oil producers likely will see annual growth of about 234,000 barrels per day through 2019.
Domestic oil production fell every year for almost 40 years until 2007.
It has increased since, and the EIA's latest forecast shows U.S. production in 2019 topping levels from 1990.
“The growth results largely from a significant increase in onshore crude oil production, particularly from shale and other tight formations,” the EIA report stated.
The oil and gas industry today faces a new challenge.
Finding oil is no longer the problem.
Horizontal drilling and hydraulic fracturing have unlocked vast amounts of dense, tight rock that oil companies have known about for decades, but previously had been unable to produce economically.
The question now is whether the companies have the infrastructure, manpower and public and political approval to continue expanding.
Pipelines, electricity and workers may not be cheap, but they are available for the right price.
Winning the public relations battle — especially in places such as Pennsylvania and California — could prove more difficult.