Skeptics of the U.S. energy boom say it can't last much longer because it requires drilling an ever-increasing number of wells.
But the boom already has lasted longer than anyone would have imagined just a decade ago and has more room to run. That's because oil and natural-gas wells have become more productive—an unrecognized but potent trend that should keep the fuels flowing.
Back in 2003, the energy industry had just begun combining the techniques of drilling horizontal bores through shale and then using hydraulic fracturing—shooting tons of water, chemicals and sand into the rocks.
Four Sevens Oil Co. drilled the best gas well that year, in the Barnett Shale, just north of Fort Worth, Texas, according to Drillinginfo, an industry data service that searched its records at the request of The Wall Street Journal.
Four Sevens used what was then considered a whopping 2.8 million gallons of liquid and 221,000 pounds of sand in fracking the well, named the Braumbaugh after the family that owned the mineral rights.
At its peak, 5.9 million cubic feet of gas a day rushed up the well. "We were real happy with it," says Four Sevens co-founder Dick Lowe. When the state published the production data, competitors were envious.
Today, the Braumbaugh looks like a pipsqueak.
Cabot Oil & Gas Corp. COG -0.69% drilled the best gas well in the U.S. last year, in Susquehanna County, Pa., about 110 miles northwest of Manhattan. Drilling longer horizontal legs and fracking the well repeatedly, Cabot pumped in 12.5 million gallons of liquid, more than four times the amount Four Sevens had employed, and used 13.3 million pounds of sand.
The well produced 30.3 million cubic feet a day—five times as much as the Four Sevens record setter a decade earlier.
"That's a pretty damn good well," Mr. Lowe says. "I might have dreamed of drilling a well that size."
The U.S. oil-and-gas industry no longer spends its time trying to find new shale formations to tap. Instead, it focuses on finding ways to get more out of the formations it has found. And it is succeeding.
As a result, the U.S. has become the world's largest energy producer, natural-gas prices have remained low and U.S. oil output has helped prevent rising crude prices around the world.
Of course, bigger and better wells come with bigger price tags, leaving drillers more vulnerable to falling energy prices.
These more aggressive operations also can create environmental problems from increased sand mining and the use of more potable water for fracking. Disposing liquids used for fracking can trigger earthquakes. Bigger fracking operations also require additional equipment and truck trips, creating more headaches for surrounding communities.
What's beyond dispute is that the newly drilled wells are better than the ones they are replacing.
The number of rigs drilling in the U.S. is basically flat, but production is rising. The federal Energy Information Administration calls this "drilling productivity" and says it is showing no sign of slowing.
Lynn Westfall, the EIA's director of energy markets and financial analysis, points out that the rig count in South Texas' Eagle Ford Shale "has not changed since 2012, but the production per new well has doubled."
Innovation makes the difference. The federal government recently predicted that oil production would rise through 2019 and then flatten off. But a second scenario in the report assumed that extraction technology would continue to improve, leading crude output to rise through 2040, if not longer.
The recent history of oil wells productivity is similar to that of gas wells.
In 2003, Headington Oil drilled an experimental well into the Bakken Shale in Montana near the North Dakota border. Headington, a private Dallas-area company, pumped in 326,000 gallons of liquid and used 640,000 pounds of sand. The well produced 828 barrels a day in October 2003.
Pat Smith, Headington's chief operating officer, says his approach back then was "to frack the heck out of it."
Turns out he didn't know from big fracks. EOG Resources Corp. EOG -0.58% last year drilled a well in the Eagle Ford Shale, using 30 times as much liquid. It also used 14.2 million pounds of sand. The result: 2,748 barrels a day.
Headington sold its Montana properties to XTO Energy Inc., now part of Exxon Mobil Corp. XOM +0.53% , for $1.8 billion in 2008. Founder Tim Headington took some of his earnings and bankrolled Hollywood movies, such as "Hugo" and "Rango."
Mr. Smith is still chasing oil and looking to drill in the Permian Basin. But first, he needs to get up to speed on modern fracking. "I have a big learning curve," he says.
Write to Russell Gold at email@example.com