Fracking shifts U.S. oil production away from California
Fracking shifts U.S. oil production away from California
In June, California produced a daily average of 285,000 barrels of crude oil, according to new data from the Energy Information Administration. That’s the state’s lowest production of any month in the government’s dataset going back to 1981 and about a quarter of what California produced 40 years ago. This comes as the U.S. as a whole is producing a record amount of crude oil.
Twenty years ago, the U.S. was the world’s biggest net importer of oil from abroad, per Mark Finley, an energy researcher at Rice University. But those days are long gone.
“The United States is producing more oil than any country ever in the history of the planet,” he said.
The boom has turned the U.S. into a net oil exporter, Finley said. And it’s thanks in large part to one thing: “Shale, in a nutshell.”
Shale that can be fracked to get at the oil and gas inside it. Fracking took off around 2010, and it changed where the U.S. was producing its oil. New hotspots included the Bakken oil field in North Dakota and the Permian Basin in Texas and New Mexico. Meanwhile, traditional rigs in California — once a heavyweight producer — have been pumping fewer and fewer barrels since the 1980s.
“So those are old reservoirs and they’re in decline,” said Amy Myers Jaffe, a professor at NYU who researches energy markets.
California doesn’t have much in the way of potentially lucrative shale deposits, she said. So companies are investing elsewhere.
“It’s just not an attractive place to drill when there are other places, even in the United States, like Texas and other locations in the Southwest,” Jaffe said.
California’s regulatory environment is also changing, Jaffe added. Historically, she said the state didn’t restrict oil producers all that much — especially when it comes to water pollution caused by drilling.
“Surprisingly, California is pretty liberal about what they allow the companies to do with process water and things like that,” she said. “And if anything, California needs to tighten that up.”
Recently though, there are signs that’s happening, said Dan Kammen, a professor of energy at UC Berkeley.
“There’s been a series of rulings against the oil industry,” he said.
A state law taking effect this year prohibits the drilling of new oil wells within a half mile of homes or schools, due to concerns over respiratory health and air quality. And then there’s California’s effort to reduce reliance on fossil fuels.
“California was the first state to set an electric vehicle mandate. So gas-powered new cars will not be sold in California after 2035.
So with well-tapped geology below ground and a climate-focused statehouse above, Kammen doesn’t see California’s oil industry bouncing back — even as drillers around the country cash in on record production.
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