Oklahoma's oil production value increases 56.3%

Journal Record, The (Oklahoma City), Jan 15, 2008 by David Page

Higher oil prices boosted the value of Oklahoma's oil production in November to $470.6 million, up 56.3 percent from $301 million a year earlier.

The value of the state's oil production increased as production declined. Oil production for the month totaled 5.1 million barrels, down 5.2 percent from 5.4 million barrels for November 2006, according to a monthly report released Monday by the Oklahoma Independent Petroleum Association.

Oil producers received an average of $91.85 per barrel for the month, up 65 percent from $55.68 a year earlier. It was the first time the monthly average price paid oil producers exceeded $90 per barrel, according to the report.

"As an energy-producing state, higher energy prices are a blessing for the economy," said John Pilkington, OIPA chairman and an independent producer from Tulsa. "Higher prices allow established energy producers to expand their business in an effort to meet the growing demand for oil and natural gas, and they provide an opportunity for new companies to explore our state for untapped energy sources.

"The result is industry growth that creates new jobs for Oklahomans and puts more money in our state's economy."

Energy production employment in November totaled 47,400 jobs, up 6.3 percent from November 2006.

The value of the state's natural gas production for the month totaled $993 million, up 6.7 percent from $930.9 million for November 2006, according to the Oklahoma Energy Index. The index is produced by the OIPA and the office of David Fleischaker, state secretary of energy, to measure the oil and gas production economy.

November's index totaled 232.1, up from 228.6 in October and 219.1 for November 2006. January 1995 is the base year with an index of 100.

The increase in the index for November was directly related to higher prices, said Karr Ingham, an economist who compiles the index.

"From crude prices to rig counts to intents to drill to energy company stock prices, industry indicators in Oklahoma are once again on the rise," Ingham said.

Oklahoma's active drilling rig count for November totaled 197, up from 181 a year earlier. In November, 566 intents to drill were filed with the Oklahoma Corporation Commission, up 21.7 percent from 465 a year earlier.

"There is no indication growth in the oil and gas industry has reached its peak," Pilkington said. "In Oklahoma, the benefits to the state's economy provided by the industry growth far outweigh any negative impacts of higher prices to the state's consumers."