North America is now characterized by significant and sustainable oil production growth, according to a study of oil to 2015 by Simmons & Co. International. The Houston-based investment banker and research firm looked at a number of oil price scenarios, companies and producing basins.

“It’s very exciting to see the opportunities the industry has in oil today,” said managing director and research head Jeff Dietert, speaking to the Houston Producers’ Forum.

Oil production growth onshore, in the low-case scenario of $70 per barrel, continues through year-end 2013 and stagnates in 2014, with a number of higher-cost plays being uneconomic. But, Simmons thinks oil prices will trade in a higher range, from $85 to $100.

“The global market is going to need U.S. production, so we’d be surprised to see oil prices at $70 last,” Dietert said. “U.S. production is needed to offset poor performance in other non-OPEC areas.

“In the low case of $70 a barrel, we see growth to 7.6 million barrels a day by year-end 2015, or growth of 200,000 barrels a day per annum. In any case, we project 7 million barrels a day by the end of this year.”

The U.S. production exit rate at the end of 2011 was 6.2 million barrels a day, making the U.S. the world’s third-largest producer after Saudi Arabia and Russia. Our production bottomed at slightly less than 5 million a day in 2005, so a great deal of growth has already occurred. Imports have fallen to 8.5 million a day from 10 million a few years ago.

In Simmons’ base-case scenario, $85 per barrel, production would rise to 8.8 million barrels a day by year-end 2015, which is similar to the peak seen in 1987 before the North Slope of Alaska began its decline. If oil is $100, then U.S. production could climb to 10 million barrels a day, a level of output not seen since 1970 — and equal to what Saudi Arabia produces today.

Simmons covers more than 30 E&P companies and a number of integrateds, and it ran the three scenarios through each with different capital-spending estimates. It also used well data from HPDI to analyze every play, and assumed a 10% improvement going forward in estimated ultimate recoveries (EURs) in the high case; 5% in the base case.

“Most of the growth is coming from the Bakken and Eagle Ford shales and the oil-rich Permian Basin. Past 2015, it becomes a question of what to expect from some of the emerging plays that we don’t yet know enough about,” Dietert said.

The most rapid growth currently is coming from the Eagle Ford, from 2012 to 1015. In terms of actual barrels, the Permian is tops.

Simmons’ rig-count expectations foresee 1,400 oil-directed rigs currently declining to about 1,000 in the low-case scenario at $70, and rising to 1,900 rigs in the high case, by 2015.

“Where could we be wrong?” Dietert asked. “The number one thing is our well type-curve assumptions, including EURS and decline rates. The core areas of some of these plays are not fully defined yet. We are going to have to drill more to figure out what we’ve really got.”