COLORADO SPRINGS, Colo.
The boom in shale oil and gas, and tar sands oil output is good
news for America, as well as the U.S. energy and metals
sectors, a Marathon Petroleum Corp. executive said May 16 at
the joint annual meeting of the American Iron and Steel
Institute and Metal Service Center Institute.
The Findlay, Ohio,-based
refinery operator expects oil and gas production in the United
States and Canada to continue growing and to "change the
competitive landscape" as the boom will "back out imports from
the Middle East and elsewhere.
"Obviously, new pipelines have
to be built," according to C. Michael Palmer, Marathons
senior vice president of supply, distribution and planning.
"This is good news for the petroleum business, good news for
the steel business and good news for America."
Long term, North American oil
demand will be flat but U.S. production will rise. Canadian
imports will increase and other foreign imports will decline,
Between 2012 and 2020, Marathon
expects growth from Canadian and U.S. shale plays to total
about 4 million barrels per day.
In Canada, production is
expected to rise by 1.8 million barrels per day over the next
seven years. "The resource is huge: The third largest behind
Saudi Arabia and Venezuela," Palmer noted.
In the United States, "there are
a lot of (shale plays) available and some are really big," he
said, citing the Bakken region in North Dakota. Last year, the
Bakken produced 660,000 barrels per day, and is expected to hit
1.5 million barrels per day by 2020.
"The estimated recoverable
reserves are 18 million barrels. Its drilling life is not a
flash in the panits estimated at 35 years," Palmer
The Eagle Ford play in south
Texas produced 450,000 barrels per day last year and should
reach 1.2 million barrels per day in 2020, he said. "Estimated
recoverable reserves are 14 billion barrels (to last) 35 to 40
The Permian basin, located in
west Texas and New Mexico, produced 1.3 million barrels per day
last year and should reach 1.7 million barrels per day by 2020
and maybe more, Palmer said, pegging estimated recoverable
reserves at "at least 22 billion barrels, or roughly 30 years
of drilling life."
Lastly, the Utica play in
northeast Ohio is slowly ramping up. Last year it produced
three barrels daily, but will get to 120,000 per day by 2020.
"Estimated reserves are 3 billion barrels, so we think the
drilling life could be 35 to 40 years," he said.