April 6, 2015 Source: Copyright BP, p.l.c. Used with permission Republished April 7, 2015, 11:20 a.m., text was modified. With the growth in U.S. production of light tight oil (LTO) in recent years, petroleum refiners in the United States have been processing greater volumes of LTO. To date, increased volumes of domestic LTO have mainly been accommodated with no- and low-cost options such as reducing light crude oil imports, increasing refinery utilization rates, making incremental efficiency improvements (crude unit debottlenecking), and displacing medium crude oil imports. A new EIA report reviews a range of additional options that U.S. refiners may consider to expand LTO processing capacity. The costs of these generic options vary according to each facility size, complexity, location, and a number of other factors: Size. Larger projects to provide additional LTO distillation capacity can have a greater overall cost but, given economies of scale, a lower per-barrel...

April 3, 2015 Although pumped hydroelectric storage makes up most of the total electricity storage capacity in the United States, nonhydro storage has doubled in electric power sector capacity from 160 megawatts (MW) to nearly 350 MW over the past five years. About 98% of the U.S. electricity storage is pumped hydroelectric storage, where water is pumped to a higher-elevation reservoir during off-peak demand and then run back down through a turbine during peak demand. However, pumped storage facilities are expensive to build and have specific siting requirements , making additional capacity builds in pumped storage infrequent. Nonhydro storage systems, which include compressed air, batteries, and flywheels, can provide several ancillary services to the grid , including regulating the grid's frequency on a second-to-second or minute-to-minute basis and fast-ramping capacity to cover sudden and unexpected gaps between electric demand and supply. The economic value of these services is beginning to be...

April 2, 2015 Source: U.S. Energy Information Administration, based on Evaluate Energy Note: Hedging is a financial risk-reduction strategy that market participants can use to lock in future prices. The decline in crude oil prices since last summer has had a direct impact on oil producers' sales revenue, but hedging strategies have lessened the effects of lower prices on some producers' total revenue. Oil producers who adopt hedging strategies can reduce their price risk and generate smoother financial outcomes in unstable markets. A common hedging practice is to sell futures and swaps to lock in desired prices for future production, a practice that can shield producers' revenue from decreasing prices. Analysis of hedging can be difficult because not all producers consistently report their hedging activity. In general, producers are not required to report hedge effectiveness in regulated financial statements. However, 32 U.S. oil producers have consistently reported their hedge...

April 1, 2015 Source: U.S. Energy Information Administration, based on DrillingInfo Inc., New York State Geological Survey, Ohio State Geological Survey, Pennsylvania Bureau of Topographic & Geologic Survey, West Virginia Geological & Economic Survey, and U.S. Geological Survey Note: Map includes production wells from January 2003 through December 2014. Click to enlarge . Natural gas production from the Marcellus shale formation in the Appalachian basin increased to 14.4 billion cubic feet per day (Bcf/d) in January 2015, accounting for more than 36% of shale gas production and more than 18% of total dry natural gas production in the United States, according to EIA's Natural Gas Weekly Update . Recent updates to EIA's maps and geologic information for the Marcellus shale play help to characterize the formation's structure, thickness, and extent. EIA uses well data to construct maps showing the formation extent and structure of the productive and prospectively productive regions of...

Source: U.S. Energy Information Administration based on data from the Surface Transportation Board and other information Note: Crude-by-rail movements greater than 1,000 barrels per day are represented on the map; short-distance movements between rail yards within a region are excluded. PADD denotes Petroleum Administration for Defense District. For the first time, EIA is providing monthly data on rail movements of crude oil, which have significantly increased over the past five years. The new data on crude-by-rail (CBR) movements are integrated with EIA's existing monthly petroleum supply statistics, which already include movements by pipeline, tanker, and barge. The new monthly time series of crude oil rail movements includes shipments to and from Canada and dramatically reduces the absolute level of unaccounted for volumes in EIA's monthly balances for each region. EIA is initiating the new series with monthly data from January 2010 through the current reporting month, January 2015. CBR...

March 30, 2015 Source: U.S. Energy Information Administration, Petroleum Supply Monthly U.S. crude oil production (including lease condensate) increased during 2014 by 1.2 million barrels per day (bbl/d) to 8.7 million bbl/d, the largest volume increase since recordkeeping began in 1900. On a percentage basis, output in 2014 increased by 16.2%, the highest growth rate since 1940. Most of the increase during 2014 came from tight oil plays in North Dakota, Texas, and New Mexico where hydraulic fracturing and horizontal drilling were used to produce oil from shale formations. In percentage terms, the 2014 increase is the largest in more than six decades. Annual increases in crude oil production regularly surpassed 15% in the first half of the 20th century, but those changes were relatively less in absolute terms because production levels were much lower than they are now. Crude oil production in the United States has increased in...

March 27, 2015 Source: U.S. Energy Information Administration, Form EIA-814 Republished March 27, 2015, 10:15 a.m., graph was corrected. In April 2014, after 35 years of shipping propane from western Canada to the upper Midwest, the Cochin pipeline was removed from propane service, and in July repurposed to ship light petroleum liquids north from Illinois to western Canada . Without this pipeline, western Canadian propane production has been shipped by other existing transport modes or placed into inventory at Canadian storage facilities. Recently, the declining value of western Canadian propane has encouraged the development of projects to provide additional outlets for growing production. Prior to its removal from propane service, the Cochin pipeline provided an effective outlet for western Canadian propane production. EIA tracks imports of propane by port of entry. Historically, propane imported from Canada on the Cochin pipeline had been reported at one of three border crossings into North...

March 26, 2015 Source: U.S. Energy Information Administration, Petroleum Supply Monthly According to EIA monthly supply data through December 2014, which EIA released in late February, U.S. exports of fuel ethanol in 2014 reached their second-highest level at a total of 826 million gallons. This level was second only to the 1.2 billion gallons exported during 2011 and 33% more than exports of fuel ethanol in 2013. Similarly, U.S. imports of ethanol, which totaled approximately 377 million gallons during 2013 , fell by 81% to a total of 73 million gallons in 2014, their lowest annual level since 2010. As a result, the United States was a net exporter of fuel ethanol for the fifth consecutive year and exported the fuel to 37 different countries in 2014. In the United States, ethanol is primarily used as a blending component in the production of motor gasoline (mainly blended in volumes...

March 25, 2015 Source: U.S. Energy Information Administration, based on Thomson Reuters and Evaluate Energy Note: Q1 2015 prices are through March 16. Based on financial statements from selected international oil and natural gas companies, spending on upstream investments was 12% lower in fourth-quarter 2014 compared to the same period in 2013. Upstream spending on exploration and development typically accounts for the bulk of these companies' investment expenditures. Aggregating the reports of 23 global oil- and natural gas-producing companies, upstream capital expenditure totaled $77 billion in the fourth quarter of 2014, which was $10 billion, or 12%, less than in fourth-quarter 2013. Three of the four quarters in 2014 had year-over-year declines in spending, bringing full-year 2014 upstream capital expenditure to $297 billion, 6% less than full-year 2013 spending for these companies. Much more so than midstream and downstream investments dealing with the refining, distribution, and sale of oil...

March 23, 2015 After increasing for 15 consecutive weeks, crude oil storage at Cushing, Oklahoma, reached 54.4 million barrels on March 13, according to EIA's Weekly Petroleum Status Report . This volume is the highest on record, but not the highest percent of storage utilization, as working storage capacity at Cushing has also increased over time. Storage levels at Cushing are significant, because Cushing serves as the delivery point for the United States crude oil benchmark , West Texas Intermediate. Sited in central Oklahoma, Cushing is home to both a network of crude oil pipelines and storage capacity. The 70.8 million barrels of storage capacity in Cushing represent more than 60% of all crude oil working storage capacity in the Midwest (as defined by Petroleum Administration for Defense District 2) and about 19% of all commercial crude oil storage in the United States. Although inventory levels at Cushing are at their...