Texas District 8 Through The Bubble Point

by David Archibald

7 April 2025

 

 

 

The chart above is based on data from Howard County, Texas. Its significance is that there was a clear break from a rising trend in oil production with a bounded gas/oil ratio to a new trend of straight-line decline in oil production rate combined with a more rapidly rising gas/oil ratio.

The physical explanation is that as reservoir pressure in the oil-producing horizons continued falling with production, it eventually fell below the bubble point at which gas comes out of solution in the oil. This happened in September 2023. Gas bubbles are far less viscous than oil and travel through the fracking-induced cracks faster than oil. Once gas bubbles begin to occur, this trend is self-reinforcing and the gas to oil production ratio rises faster.

In the year to September 2024, Howard County’s oil production rate fell 30%. If that decline rate continues, Howard County’s oil production will be next to nothing in a few years. So, going through the bubble point of a reservoir has significant economic impact. At the county level, Loving County is also showing a clear break in trend that is bubble point driven:

 

 

The production decline in Loving County is 24,000 barrels per day since September 2024. This is an annualised decline rate of 35%. Loving County is also a significant gas producer from its gas wells, almost a billion cubic feet per day. The following graph shows the condensate yield of Loving County’s gas production from 2010:

 

 

Five years ago, Loving County’s condensate yield was almost 250 barrels per million cubic feet, indicating that the gas in the reservoir was likely at the limit of what it could hold in solution. The straight-line decline trend since then indicates that liquid hydrocarbons having been dropping out of solution in the reservoir as reservoir pressure drops with continued production.

With the methodology established at the county level, it now can be applied at the District level. The gas/oil ratio plot of District 8 of the Texas Railroad Commission follows:

 

 

There was a clear break in trend in June 2024. The monthly decline rate since then has averaged 32,000 barrels per day, an annualised rate of decline of 13%. At that rate, from December’s production rate of 2.7 million barrels per day, production would fall by 350,000 barrels per day by December 2025.

District 8 contains Loving and Howard counties. It is also a significant gas and condensate producer:

 

 

The chart shows that, while gas production has been relatively flat for the last five years, condensate production starting diving a few months ago as shown in this graph of condensate yield for District 8:

 

 

The sudden decline in yield starting in July 2024 suggests that in an originally undersaturated gas reservoir in District 8, the reservoir pressure fell below the point at which retrograde condensation of liquid hydrocarbons starts. While gas production might hold up as operators open chokes to reduce backpressure on their reservoirs, liquids production might fall rapidly.

 

 

David Archibald is the author of The Anticancer Garden in Australia