Adam Wilmoth: Oil production continues to surge

Despite a slowdown in drilling activity, oil production has continued to soar in Oklahoma and nationwide.

Much of the reason for the growth is that drillers continue to become more efficient, boosting both initial production and total production from each well, according to a report Friday from the U.S. Energy Information Administration.

"More effective drilling techniques, including the increasing prevalence of hydraulic fracturing and horizontal drilling, have helped to increase these initial production rates," the report stated. "In particular, well productivity was improved because of the injection of more proppant during the hydraulic fracturing process and the ability to drill longer horizontal components (also known as laterals) and perforate more stages."

In Oklahoma's Anadarko Basin, each active drilling rig is expected on average to contribute 647 barrels of oil per day and more than 4.4 million cubic feet of natural gas per day in February, up 20 barrels of oil and 107,000 cubic feet of natural gas per day from January levels, the report stated.

Efficiency has improved steadily over much of the past decade.

Since the start of 2011, oil production per rig has surged more than sixfold and natural gas production is up almost 200%, the report stated. At that time — just nine years ago — the average rig in the Anadarko Basin represented about 100 barrels of oil per day and about 1.4 million cubic feet of natural gas per day.

The efficiency gains have a significant effect on Oklahoma's economies. It's the reason oil and natural gas production has set new records almost every month even as the number of active rigs in the state has tumbled, falling to 53 this week, down from 126 one year ago, according to Baker Hughes.

Each drilling rig employs dozens of workers and supports many more local jobs as those workers eat, shop and otherwise spent money near the rig sites.

So a drastic decline in the number of active rigs in the state has hurt rural Oklahoma's employment numbers and affected the local economies.

But the effect on the state economy has been far less pronounced.

Oil-field employment tax collections have been reduced somewhat. But the state most heavily benefits from the gross production tax, which is collected on oil and natural gas production, not the rig count.