HOUSTON—Improved efficiency and flexibility have boosted production from U.S. shale plays, but as output nears a tipping point the nation must decide whether it will export more refined products or oil, panelists said during a symposium this week.

Discussion comes as U.S. producers try to pump their way to a higher market share though forces—namely low oil and gas prices, not enough demand and a worldwide wealth of hydrocarbons—have caused a slowdown with less drilling activity. However, flexibility will be the key when prices rise, and some plays appear better positioned than others.

“We’re reaching a point where, because demand is not growing at the same pace as production, the United States is going to rely on exports to balance the market,” said Anne Swedberg, manager of North American gas and power content for Bentek Energy, an analytics and forecasting unit of Platts.

The market has always operated in a loop—going from high price with increased drilling and lower demand to high production with lower commodity prices, Swedberg explained June 10 during Platt’s Benposium. That leads to low price, where the market is now, typically with increased demand and reduced drilling activity, followed by high demand with a rise in commodity prices.

But don’t expect to see a change in prices unless there is a large increase in demand.

Regardless, producers are showing flexibility and improving efficiency.

Flexibility: In the Northeast, home of the Marcellus and Utica shale plays, there is a 10 Bcf/d swing in demand from winter to summer. “We are already seeing producers react to that,” she said, by reducing the flow from wells until demand picks up.

She also tagged the Haynesville Shale as another area capable of responding quickly to shifting market conditions, specifically to meet rising gas demand, if the Henry Hub price increases. Haynesville, she said, is where the industry started to use new technology targeting shale plays. Within four years, companies produced about 6 Bcf/d at Haynesville’s peak. Drillers here took the same technology to oil plays such as the Eagle Ford, where similar growth trajectories followed, she added.

Efficiency: The average IP rates have doubled in most basins due to improved technology and techniques that have improved efficiency, thus growing production. IP rates in the Eagle Ford have jumped by 111% from 2010 to 2014, according to Platts. The Permian, Marcellus, Anardarko and Bakken have also seen double-digit growth, going 87% and 50% in the Permian and Marcellus, respectively. The Anadarko and Bakken have both seen 23% increases.

Efficiency gains are evident in the days required to drill one well. The greatest improvement was seen in the Haynesville, where time to drill one well dropped for about 44 days in 2010 to 31 days in 2013, Swedberg said.

“In the areas that have seen the most increase in initial production rates, which are the Eagle Ford and Marcellus, you can drill a well within 12 days now,” she said. “The DJ has seen huge improvements with about eight days to drill one well. The ability for producers to bring product into market has been greatly reduced and the amount of product that is coming out of these wells has increased.”

Production: Between 2005 and 2010, production from the Lower 48 increased 8.7 Bcf/d, or 18%. During the next five years, growth amounted to about 15.7 Bcf/d, or 28%, Platts data show.

The Marcellus has outperformed its shale peers in gas production. “Within two or three years it was already surpassing what the Haynesville had reached during five years,” Swedberg pointed out. “The trajectory is pretty steep. … After six years, the region has over 16 Bcf/d.”

She added that 2015 will be a big year for the Northeast as it shifts from being a demand center to a production center. Production from the Northeast made up about 5% of total U.S. production in 2005. It’s now 35%. But more infrastructure is needed—something companies are working to develop by expanding pipeline capacity.

Meanwhile, production growth in the northeast and other parts of the U.S. is pushing the nation toward a tipping point because demand is not keeping pace with production.

“This is the last year, with the growth from demand industry, that we’re able to absorb all of that production,” Swedberg said. “Back in 2005 and 2006, the United States had to bring in about 10 Bcf on an annual average to balance the market. … We’ve seen U.S. production grow roughly 3 Bcf every year.

So theoretically we are within one year of becoming self-sufficient.”

Going forward the U.S. will depend on exports, including LNG exports and exports to Mexico, to continue production growth, she added.

Contact the author, Velda Addison, at vaddison@hartenergy.com.