The unconventional reservoirs revolution is an exciting time for the oil and gas industry. With nearly 70% of wells in the U.S. being drilled horizontally, it is safe to say horizontal wells are here to stay.

More than 95% of wells drilled today are hydraulically fractured, accounting for more than 43% of U.S. oil production and 67% of natural gas production, according a 2011 report by the National Petroleum Council.

Greg Leveille, technical program manager for unconventionals at ConocoPhillips, described the unconventional reservoirs revolution as “a transformational event” and “one of the biggest events in the history of our industry.” Leveille was the keynote speaker at the sold-out session titled “The Unconventional Reservoirs Revolution” on Oct. 6 at the SPE Artificial Lift Conference.

“We’re getting to live through [this unconventional reservoirs revolution] and participate in it, and we’re making history every day,” Leveille said. “There’s nowhere in the world today that’s growing oil and gas production more quickly than the U.S., and nobody thought that was possible just a few short years ago.”

According to the U.S. Energy Information Administration (EIA), total U.S. crude oil production averaged about 8.7 MMbbl/d in September 2014, the highest monthly production since July 1986. Total crude oil production is expected to average 9.5 MMbbl/d in 2015, up from an average of 7.4 MMbbl/d in 2013. If realized, the 2015 forecast would be the highest annual average crude oil production since 1970, according to the EIA.

Leveille’s presentation centered on the size of the unconventional revolution and how it’s transforming the industry; concerns and benefits, which included the economic, energy security and environmental impacts; and the importance of artificial lift and unconventional reservoirs and the challenges involved with them.

He outlined the four big unconventional reservoir plays—the Eagle Ford, Bakken, Permian and Marcellus—and said each of these plays has tens of billions of barrels oil equivalent of recoverable resources.

“For the Eagle Ford, Permian and Bakken, those numbers are almost certainly up in the 20 plus billion barrels oil equivalent frame,” Leveille said. “If you think about that, the largest conventional oil field ever found in the U.S. is Prudhoe Bay, and that’s around 14 billion barrels of oil recoverable. You’re looking at at least three unconventional reservoir fields with volumes that exceed the largest conventional field ever found, so this is a big deal.” He expects these numbers will keep growing as companies continue drilling for oil.

Comparing production growth in Texas to production in OPEC nations, which has 12 producers, Leveille said that OPEC had been the dominant power in the oil industry since the early 1980s; however, the roles have reversed.

By year-end 2009, Texas produced 1.1 MMbbl/d, but 11 of the 12 OPEC nations were producing more than Texas. By 2012, Texas’ production had doubled, reaching 2.2 MMbbl/d. At that point it was “about in the middle of the pack,” Leveille said.

Just nine months ago, Texas was sitting at about 2.8 MMbbl/d of oil, and it was ahead of all the OPEC producers except for Saudi Arabia, Iran and Iraq, according to his presentation. This change, said Leveille, has led Texas to a whopping 3.1 MMbbl/d of oil, and Texas will have produced 3.4 MMbbl/d by year-end 2014.

“At that point, Texas will be producing more oil than every OPEC nation, except for Saudi Arabia,” Leveille continued. This change is being driven by these large unconventional reservoirs. “We suggest that the size of each individual appeal in the U.S. and probably around the globe are as large or larger than most of the big conventional fields.”

The U.S. is the world’s largest natural gas producer. But the shale boom has brought benefits as well as concerns.

Economy: With an “enormous surge in jobs in the E&P industry,” the economy is booming. Today, there are about 1.8 million jobs associated with unconventional reservoirs, he said, and by the year 2030, that will nearly double. The unemployment rate in the U.S. is less than 6%, and a big part of that has to do with what oil and gas companies are doing in unconventional reservoirs, Leveille continued. “The good news is this isn’t just an oil and gas industry success story, because as the amount of activity in oil and gas has increased, so has the impacts on other related things. [For example,] the chemistry industry today is growing very rapidly, [and] that’s beginning to translate into a manufacturing sector.”

Energy security: The U.S. imported energy in quadrillion of Btus, he said, and “if you look at the U.S. energy imports, we’re basically becoming more and more beholden to other nations for our energy securities.”

Leveille said this impacts U.S. armed forces deployed across the world and the security of the U.S. and its citizens. “Look [at] what’s happening in Russia today, in Iraq, [and] a lot of areas around the world where there are some scary things going on. The fact that the U.S. is becoming an energy powerhouse is really a force of good in the world.”

Environmental benefits: In the middle part of the last decade, U.S. CO₂ emissions peaked, but they’ve been falling ever since due almost completely to natural gas backing out coal, Leveille said.

“Natural gas emits about half the CO₂ per unit of energy as coal, so that’s had a really dramatic impact on the production [of] CO₂ in the U.S.,” he said. Other benefits of natural gas are that it is clean-burning, has a small water usage footprint, no solid waste, and enables wind and solar power.

President Barack Obama recently released a CO₂ emissions target for the U.S. The goal is to reduce emissions by 30% in 2030 from the high point in 2005.

“Now that sounds like a really bold statement, and in some ways it is, but you have to remember we had already dropped emissions 12% between 2005 and today, so we’re already a long ways there,” Leveille said. “This is something which should be achievable. America should be able to achieve this result, because as we back out more and more coal with natural gas, CO₂ emissions are going to go down.”

Leveille added that when the goal is reached in 2030 or before, the U.S. will be reducing CO₂ emissions to a level that hasn’t been seen in the U.S. since the 1960s.

Areas of concern and challenges that Leveille addressed included U.S. crude oil imports and the export ban, public perception and quality of life in the communities where fracking takes place.

Public perception: “Frankly, our industry doesn’t have the best public perception,” he said. People are concerned about the impacts. “They’re worried about what might happen to groundwater, the congestion on the roads and a number of other issues. [Our industry] needs to get out and engage the public. It needs to find ways to mitigate these impacts.”

It is important for companies to engage the people in the communities that they’re working in and listen to the public’s concerns, he continued.

Quality of life: Leveille also said companies need to try to enhance the quality of life in the communities in which they work. One way he suggested they can mitigate impacts is by treating, recycling or reusing all of the water produced in the some of the oil and gas fields. He also suggested reinvesting in the communities to ensure “quality of life in small communities is of an exceptional level,” because many of the smaller towns depend on the oil and gas industry to liven the towns up again such as through new housing, hotels and stores.

“There are things we need to do as an industry to educate people to understand what we’re trying to accomplish [and] how this can be good for the country as well as the oil and gas industry,” Leveille said. “[We] also need to get the government to realize things like oil exports are a benefit not just for the oil and gas industry but for America as a whole.”

Contact the author, Ariana Benavidez, at abenavidez@hartenergy.com