Despite an over 50 percent drop in the U.S. rig count production from the Bakken and Eagle Ford shale plays barely budged in December.
According to Platts Bentek, oil production at the Eagle Ford basin grew less than one percent month over month while production at Bakken dropped less than 1 percent from November to December.
Production from the Eagle Ford basin, located in Texas, grew by about 11,000 barrels per day from November to December, the first time since March 2015 that production at the play didn’t fall.
“The small increase in crude production in the Eagle Ford shale is attributed to a slight resurgence in drilling activity in the region,” Platts Bentek energy analyst Sami Yahya said.
Crude production in the North Dakota section of the Bakken shale formation, a part of the Williston Basin, fell by about 9,000 barrels per day from November to December, or a decline of less than 1 percent.
The production dip continued the “trend of marginal decline that began in the summer,” Platts Bentek said.
Oil production in the Eagle Ford basin averaged 1.5 million bpd in December, down about 7 percent year-over-year, while crude production in the Bakken dipped about 6 percent year-over-year to 1.2 million bpd in November.
Despite the rig count in the Eagle Ford falling from 181 rigs a year ago to 64 rigs last week, improvements in technology have helped producers maintain production levels.
“Producers back in January of 2015 could drill less than two wells per rig per month, compared to nearly three wells per month currently,” the report said.
Meanwhile, the rig count in the Williston Basin fell from 153 rigs a year ago to 45 rigs last week, according to Baker Hughes.
“At the same time, producers were able to increase their drilling rates from about 1.5 wells per rig per month to about 2.2 wells per rig per month,” Yahya said.
While Platts Bentek expects production at both plays to continue declining, Yahya said that backlog well inventory in areas where drilling costs have declined could prop up production volumes.
Platts Bentek analysis found that total U.S. crude oil production has increased by about 265,000 bpd from November 2014 to November 2015.
“If prices remain sub-$40/barrel and producers are unable to further bring down completion costs, then they might defer completions until the pricing market makes a comeback,” Yahya added.
Eagle Ford crude prices fell 18 percent between January and December 2015, with an average price of $52.01 per barrel for 2015
Prices for oil out of the Bakken fell 16 percent over the same period and averaged $45.24 per barrel last year, according to Platts Bentek.