A new report that predictably found huge potential natural gas supplies in the U.S. also contained news its own writers found surprising — that oil is more abundant than they thought.
The study released Thursday by the National Petroleum Council, a collection of industry, academic, government and other officials convened by the secretary of energy, touted how advanced technology has unlocked vast formations of natural gas previously deemed uneconomic to tap .
But the report also said the same drilling and production techniques that opened up shale gas — combined with success in the deep-water Gulf of Mexico, the Canadian oil sands and even surges in conventional oil onshore - are improving the nation’s potential to be more self-reliant for oil, according to the report.
“Contrary to conventional wisdom the North American oil resource base also could provide substantial supply for decades ahead,” the report said.
By 2035, oil from shale formations — also referred to as “tight oil” — could produce 2 million to 3 million barrels of oil per day. That includes plays such as the Bakken shale in the Northern U.S. and the Eagle Ford shale in South Texas.
Under the most optimistic assumptions the U.S. and Canada combined could produce up to 22.5 million barrels per day, the study concludes. But that isn’t likely to wean the U.S. off oil imports from overseas, the report warns, as its current daily demand already is 22.5 million barrels per day.
The potential growth of U.S. oil production is manifest on several fronts.
Texas’ oil and gas industry employment returned to its pre-recession highs in June, according to the Texas Petroleum Index, topping the last boom that peaked in October 2008.
That boom was fueled largely by the transformation of the natural gas drilling and production business, but Texas economist Karr Ingham said the expansion is driven by Texas returning to its crude oil roots.
And earlier this month, Goldman Sachs said in a note to investors it expects the U.S. - now the No. 3 oil producer behind Saudi Arabia and Russia - to take the top spot by 2017.
The National Petroleum Council, a collection of industry, academic, government and other officials, convenes several times a year to gather information, give advice and issue reports on topics for the secretary of energy. The most recent report was a 2007 study on global energy supply and demand.