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Arkansas   Arkansas Profile

State Profile and Energy Estimates

Profile AnalysisPrint State Energy Profile
(overview, data, & analysis)

Last Updated: February 16, 2017

Overview

Arkansas has a diverse geography with abundant natural resources. The Mississippi River flows along the state's eastern border, the northern edge of the Gulf Coastal Plain occupies southern Arkansas, and in the state's north and west are rugged highlands.1 The fertile Arkansas River Valley separates the Ouachita Mountains from the Ozark Plateau in western Arkansas. Most of the state's natural gas production is from the natural gas-rich Arkoma Basin, which underlies the Arkansas River Valley. Coal resources also have been found in the Arkansas River Valley near the state's western border.2,3,4 To the south, the lowlands of the Gulf Coastal Plain contain a historically significant crude oil-producing area.5

Forests cover more than half of Arkansas and provide significant biomass resource potential.

Rivers that flow generally east and south from the highland regions toward the Mississippi River provide Arkansas with considerable hydroelectric resources.6 The Mississippi River Valley and the upper reaches of its delta occupy the eastern third of Arkansas.7 The Mississippi River's alluvial plain has rich soils that, along with the state's hot, humid summers and mild, slightly drier winters, provide excellent conditions for agriculture.8,9 Agricultural wastes and the forests that cover more than half of the state supply Arkansas with significant biomass resource potential.10,11

Arkansas produces more total energy than it consumes, primarily because of its abundant natural gas resources, but the state's per capita total energy consumption is in the top one-third of all of the states in the nation.12,13 The electric power sector consumes the most energy in Arkansas, followed by the industrial sector, which includes agriculture.14 Rice and poultry are two of the state's most important agricultural products, and food production leads the manufacturing sector in terms of revenue.15 Several energy-intensive industries are major contributors to the state's gross domestic product and the industrial sector's energy use. They include natural gas and crude oil extraction; the forest products industry, encompassing everything from harvesting timber to making wood and paper products; and the manufacture of fabricated metal products, primary metals, chemicals, petroleum products, and plastics.16

Arkansas has a relatively mild climate, but changes in terrain and increases in elevation from the coastal plain to the state's northern highlands can cause weather extremes.17 Per capita energy use by the residential sector is higher in Arkansas than in more than three-fourths of the states.18 Most households heat with electricity or natural gas, although more than one in nine use liquefied petroleum gas or wood for heating.19

Petroleum

Arkansas led the nation's crude oil production in the 1920s with the discovery of the Smackover oil field.

Arkansas has only a modest amount of remaining proved petroleum reserves.20 However, the state led the nation's crude oil production in the 1920s with the discovery of the giant Smackover field in southern Arkansas-a field that has produced more than 600 million barrels of oil.21 Wells in the state have produced about 2 billion barrels of oil since 1920, but production has declined. Many of the wells in the state's once giant fields are now stripper wells that produce less than 10 barrels of crude oil per day. Arkansas still produces more than 6 million barrels of crude oil per year.22,23 Crude oil production continues to be concentrated in southern Arkansas's Gulf Coastal Plain.24

Arkansas has two oil refineries that have a combined operable capacity of more than 90,000 barrels of crude oil per calendar day. A small refinery, in Smackover, Arkansas, processes about 7,500 barrels per calendar day. The El Dorado Refinery is much larger and can process about 83,000 barrels of sour crude oil per day.25 The El Dorado Refinery processes crude oil into ultra-low sulfur gasoline and diesel fuels, propane, solvents, and asphalt products.26 To offset declines in production from local Arkansas producers and to take advantage of increased refinery capacity, other domestic and foreign crude oils are also processed at the El Dorado Refinery.27 Two major interstate crude oil pipelines and three petroleum product pipelines cross Arkansas.28 One of the crude oil pipelines ruptured in March 2013. The subsequent oil spill shut down the Arkansas section of that pipeline and there are no current plans to restart it.29,30

The transportation sector accounts for four-fifths of the petroleum consumed in Arkansas. The industrial sector is a distant second and is responsible for one-sixth of the petroleum consumption in the state. The residential sector, like the commercial sector, uses less than 2% of the petroleum consumed in Arkansas.31 Arkansas allows the statewide use of conventional motor gasoline, and the state does not have any ethanol refineries.32,33

Natural gas

Arkansas is one of the top 10 natural gas-producers among the Lower 48 states.

Arkansas holds almost 3% of the nation's natural gas reserves and is one of the top 10 natural gas producers among the Lower 48 states.34,35 Most of the state's production is dry natural gas from the Arkoma Basin in west-central Arkansas, although there are several wells in the southern part of the state. Most of the natural gas produced in southern Arkansas is wet natural gas, containing some heavier hydrocarbons.36,37,38 Coalbed methane is also produced in the state. The development of that resource began in 2001. Arkansas is not a major producer of coalbed methane. Coalbed gas wells yielded about 28 billion cubic feet of natural gas from 2001 to 2015, much less than 1% of the state's total natural gas production.39,40,41

Gross withdrawals of natural gas in Arkansas increased dramatically between 2005 and 2012.42 Horizontal drilling and hydraulic fracturing in the Fayetteville Shale, the current focus of shale gas exploration in Arkansas, was responsible for some of the increase in production.43,44 However, because of a decline in drilling activity driven by lower natural gas prices, natural gas production in Arkansas has decreased by about 13% since peaking in 2012.45,46 Proved natural gas reserves in the state have fallen by a much larger amount since peaking in 2011. By 2015, natural gas reserves in Arkansas were at half their 2011 level.47

Arkansas produces more than three times as much natural gas as its residents consume.48,49 The state has no natural gas market centers, and only two natural gas storage fields.50 More than a dozen natural gas pipelines, mostly from Louisiana, Oklahoma, and Texas, pass through Arkansas on the way to markets in the Midwest and Northeast.51,52 Large volumes of natural gas flow into the state and even larger volumes move out, mostly through Mississippi and Missouri on their way east and north.53

Typically, about two-thirds of the natural gas delivered to consumers in Arkansas is used by the industrial and electric power sectors.54 Consumption for electric power generation rose sharply in the past decade, peaking in 2012. The electric power sector was the state's leading natural gas-consumer from 2009 through 2013, and again in 2015.55,56 In 2014, the industrial sector briefly regained its status as the leading consumer of natural gas in the state. The commercial sector uses more natural gas than the residential sector, where two-fifths of Arkansas households use natural gas as their primary source for home heating.57,58

Coal

Coal was the state's most valuable mineral resource from its first commercial production in the mid-19th century until the discovery of oil in Arkansas in the 1920s. There are only two small coal mines in Arkansas today, both in the Arkansas River Valley near the state's western border. Coal produced from the state's active mines is bituminous.59,60 The Arkansas mines supply less than 1% of the state's coal needs, and Arkansas relies on coal from other states. Almost all the coal consumed in the state is used by the electric power sector.61,62 Coal brought into Arkansas for electricity generation comes by rail from Wyoming. Industrial facilities in Arkansas obtain coal from Oklahoma and Ohio by rail and from Illinois by truck and rail.63 A small amount of Arkansas coal is trucked out of state and sent to power plants in neighboring Oklahoma.64

Electricity

Coal is the primary fuel used for electricity generation in Arkansas.

Coal is the primary fuel used for electricity generation in Arkansas and accounts for about two-fifths of the state's net generation.65 The state's two-reactor nuclear generating station provides about one-fourth of the state's net generation.66,67 Although 5 of the 10 largest power plants by capacity in Arkansas use coal, the largest power plant in the state is natural gas-fired.68 Natural gas volumes used for electricity generation peaked in 2012, when natural gas fueled more than one-fourth of the state's net generation. After a decrease in 2013 and 2014, natural gas again supplied more than one-fourth of the state's net generation in 2015.69,70,71 Two-thirds of the natural gas-fueled generation in Arkansas is provided by independent power producers.72 Almost all the rest of the net electricity generation in the state is from hydroelectric power and biomass. The industrial sector accounts for almost all the state's biomass-fueled electricity generation.73

The average price of electricity to ultimate customers in Arkansas is among the lowest in the nation. Retail sales to the residential sector are greater than sales to the industrial sector or to the commercial sector.74 Almost half of the households in the state use electricity as their primary energy source for home heating.75

Renewable energy

Hydroelectric and biomass-fueled facilities provide nearly one-tenth of net electricity generation in Arkansas.

Hydroelectric power is the most commonly used renewable resource in Arkansas, providing more than two-thirds of the state's renewable power generation. Almost all the hydroelectric generation is supplied by electric utilities. Biomass supplies nearly all the nonhydroelectric renewable electricity generation in the state, almost all from wood and wood-derived fuels.76,77,78 Solid biomass residues, including crop residues and methane from livestock, are other potential sources.79,80 Arkansas has a small but increasing amount of installed solar generating capacity.81 Overall, renewable resources provide almost one-tenth of the state's net electricity generation.82

There are three wood pellet plants in Arkansas and more in development.83 The state also has three facilities that produce biofuels from animal fats and vegetable oils.84 Arkansas does not generate electricity from utility-scale wind energy projects; however, a number of manufacturers of components used by wind generators are located in the state.85

Arkansas does not have a renewable portfolio standard.86 In 2009, the Arkansas Alternative Energy Commission was created to study the need for and impact of various forms of alternative energy in Arkansas.87 In addition, the state has adopted several policies to encourage energy efficiency. In 2009, the Sustainable Energy-Efficient Buildings Program was enacted, directing the Arkansas Energy Office to develop a plan for reducing energy use in all major existing state-owned facilities by 30% from 2008 levels by 2017.88 In December 2010, the Arkansas Public Service Commission (APSC) announced a Sustainable Energy Resource Action Plan requiring implementation of energy efficiency measures by the state's investor-owned utilities.89,90 In 2015, the APSC extended the program and increased the savings target to 1% of 2015 sales in 2019.91

Endnotes

1 U.S. Department of the Interior, U.S. Geological Survey, A Tapestry of Time and Terrain: The Union of Two Maps, Geology and Topography, accessed January 3, 2017.
2 Arkansas Geological Survey, Physiographic Provinces of Arkansas, accessed January 3, 2017.
3 Arkansas Geological Survey, Natural Gas, accessed January 3, 2017.
4 Arkansas Geological Survey, Coal, accessed January 2, 2017.
5 Arkansas Geological Survey, Oil, History of Discovery and Exploration, accessed January 3, 2017.
6 Reynolds, Jerry, Hydroelectricity, The Encyclopedia of Arkansas History and Culture, updated March 15, 2016.
7 Arkansas Geological Survey, Physiographic Provinces of Arkansas, accessed January 3, 2017.
8 Foti, Thomas, Geography and Geology, The Encyclopedia of Arkansas History and Culture, updated July 20, 2016.
9 Buckner, Ed, Climate and Weather, The Encyclopedia of Arkansas History and Culture, updated May 11, 2016.
10 Arkansas Forestry Commission, Arkansas Forest Health Highlights for 2015, accessed January 3, 2017.
11 Arkansas Energy Office, Biomass, accessed January 3, 2017.
12 U.S. Energy Information Administration (EIA), State Energy Production Estimates 1960 Through 2014, Table P3, Energy Production and Consumption Estimates in Trillion Btu, 2014.
13 U.S. EIA, State Energy Production Estimates 1960 Through 2014, Table P2, Energy Production Estimates in Trillion Btu, 2014.
14 U.S. EIA, State Energy Consumption Estimates 1960 Through 2014, DOE/EIA-0214(2014) (June 2016), Arkansas Tables CT4-CT8.
15 Arkansas, The Natural State, Kids, Arkansas Agriculture and Manufacturing Facts for Kids, accessed January 3, 2017.
16 U.S. Bureau of Economic Analysis, Interactive Data, Regional Data, GDP and Personal Income, Annual Gross Domestic Product by State, Current Dollars, All Industries, Arkansas, 2014.
17 Buckner, Ed, Climate and Weather, The Encyclopedia of Arkansas History and Culture, updated May 11, 2016.
18 U.S. EIA, State Energy Consumption Estimates 1960 Through 2014, DOE/EIA-0214(2014) (June 2016), Table C13, Energy Consumption per Capita by End-Use Sector, Ranked by State, 2014.
19 U.S. Census Bureau, American FactFinder, Arkansas, Table B25040, House Heating Fuel, 2011-2015 American Community Survey 5-Year Estimates.
20 U.S. EIA, Crude Oil Proved Reserves, Reserves Changes, and Production, Proved Reserves as of 12/31, accessed February 6, 2017.
21 Lambert, Don, Smackover (Union County), The Encyclopedia of Arkansas History and Culture, updated December 7, 2016.
22 Bridges, Kenneth, Oil Industry, The Encyclopedia of Arkansas History and Culture, updated July 29, 2011.
23 U.S. EIA, Crude Oil Production, Annual, 2015, accessed January 3, 2017.
24 Arkansas Geological Survey, Oil, accessed January 3, 2017.
25 U.S. EIA, Refinery Capacity Report 2016, Table 3, Capacity of Operable Petroleum Refineries by State as of January 1, 2016.
26 Lion Oil Company, About, accessed January 3, 2017.
27 Lion Oil Company, History, accessed December 14, 2015.
28 U.S. EIA, Arkansas State Profile and Energy Estimates, Profile Data, Distribution and Marketing, accessed January 4, 2017.
29 Associated Press, "Arkansas landowners tell court: Exxon Mobil pipeline breached deal," Arkansas Online (October 19, 2016).
30 "Exxon's Pegasus pipeline to stay shut," Energy Global World Pipelines (July 9, 2015).
31 U.S. EIA, State Energy Data System, Table F15, Total Petroleum Consumption Estimates, 2014.
32 Ethanol Producer Magazine, U.S. Ethanol Plants, All Platforms, All Plants (January 23, 2016).
33 Gardner, K. W., U.S. Gasoline Requirements, American Petroleum Institute (June 2015).
34 U.S. EIA, Arkansas Profile Data, Reserves and Supply, accessed January 18, 2017.
35 U.S. EIA, Natural Gas Gross Withdrawals and Production, Annual, 2015, accessed January 5, 2017.
36 Arkansas Geological Survey, Natural Gas, accessed January 5, 2017.
37 U.S. EIA, Arkansas Shale Production, accessed January 5, 2017.
38 Arkansas Geological Survey, Natural Gas, Fayetteville Shale Gas, accessed January 5, 2017.
39 Arkansas Geological Survey, Natural Gas, Coalbed Natural Gas Methane, accessed January 5, 2017.
40 U.S. EIA, Arkansas Coalbed Methane Production, accessed January 5, 2017.
41 U.S. EIA, Arkansas Natural Gas Gross Withdrawals, accessed January 27, 2017.
42 U.S. EIA, Arkansas Natural Gas Gross Withdrawals, 1967-2015, accessed January 5, 2017.
43 U.S. EIA, Arkansas Shale Production, accessed January 5, 2017.
44 Arkansas Geological Survey, Natural Gas, Fayetteville Shale Gas, accessed January 5, 2017.
45 Brown, Wesley, "Arkansas drilling permits see uptick in July, natural gas prices move closer to $3," Talk Business and Politics (August 4, 2016).
46 U.S. EIA, Natural Gas Gross Withdrawals and Production, Annual 2010-15, accessed January 5, 2017.
47 U.S. EIA, Natural Gas Reserves Summary as of December 31, 2010-15, Dry Natural Gas and Wet Natural Gas, accessed January 5, 2017.
48 U.S. EIA, Natural Gas Gross Withdrawals and Production, Annual, 2015, accessed January 5, 2017.
49 U.S. EIA, Natural Gas Consumption by End Use, Arkansas, accessed January 5, 2017.
50 U.S. EIA, Underground Natural Gas Storage Capacity, Total Number of Existing Fields, accessed January 18, 2017.
51 U.S. EIA, Arkansas, Profile Data, Distribution and Marketing, accessed January 5, 2017.
52 U.S. EIA, Arkansas Profile Overview, Map, Natural Gas Inter/Intrastate Pipeline and Natural Gas Market Hub Layers, accessed January 5, 2017.
53 U.S. EIA, International and Interstate Movements of Natural Gas by State, Arkansas, accessed January 5, 2017.
54 U.S. EIA, Natural Gas Consumption by End Use, Arkansas, Annual 2010-15, accessed January 5, 2017.
55 U.S. EIA, Arkansas Natural Gas Deliveries to Electric Power Consumers, accessed January 5, 2017.
56 U.S. EIA, Arkansas Natural Gas Industrial Consumption, accessed January 5, 2017.
57 U.S. EIA, Natural Gas Consumption by End Use, Arkansas, Annual 2010-15, accessed December 16, 2015.
58 U.S. Census Bureau, American FactFinder, Arkansas, Table B25040, House Heating Fuel, 2011-2015 American Community Survey 5-Year Estimates.
59 U.S. EIA, Annual Coal Report 2015 (November 2016), Table 6, Coal Production and Number of Mines by State and Coal Rank, 2015.
60 Arkansas Geological Survey, Coal, accessed January 2, 2017.
61 U.S. EIA, Annual Coal Report 2015 (November 2016), Table 6, Coal production and number of mines by state and coal rank, 2015.
62 U.S. EIA, Annual Coal Report 2015 (November 2016), Table 26, U.S. Coal Consumption by End Use Sector, Census Division, and State, 2015 and 2014.
63 U.S. EIA, Annual Coal Distribution Report 2015, By Coal Destination State (November 2016), Arkansas, Table DS-4, Domestic Coal Distribution, by Destination State, 2015.
64 U.S. EIA, Annual Coal Distribution Report 2015, By Coal Origin State (November 2016), Arkansas, Table OS-4. Domestic Coal Distribution, by Origin State, 2015.
65 U.S. EIA, Electric Power Monthly (February 2016), Tables 1.3.B, 1.4.B.
66 U.S. EIA, Arkansas Nuclear Profile 2010.
67 U.S. EIA, Electric Power Monthly (February 2016), Tables 1.3.B, 1.9.B.
68 U.S. EIA, Arkansas Electricity Profile 2014, Table 2, Ten Largest Plants by Generating Capacity, 2014.
69 U.S. EIA, Arkansas Natural Gas Deliveries to Electric Power Consumers, 1997-2015, accessed January 6, 2016.
70 U.S. EIA, Electric Power Monthly (February 2013), Tables 1.6.B, 1.10.B.
71 U.S. EIA, Electric Power Monthly (February 2015), Tables 1.6.B, 1.10.B.
72 U.S. EIA, Electric Power Monthly (February 2016), Tables 1.3.B, 1.7.B.
73 U.S. EIA, Electric Power Monthly (February 2016), Tables 1.3.B, 1.10.B, 1.15.B.
74 U.S. EIA, Electric Power Monthly (February 2016), Tables 5.4.B, 5.6.B.
75 U.S. Census Bureau, American FactFinder, Arkansas, Table B25040, House Heating Fuel, 2011-2015 American Community Survey 5-Year Estimates.
76 U.S. EIA, Arkansas Renewable Electricity Profiles 2010.
77 U.S. EIA, Electric Power Monthly (February 2016), Tables 1.10.B, 1.11.B, 1.15.B.
78 U.S. EIA, Electricity, Form EIA-860 detailed data, 3_1_GeneratorY2015, 2015 Form EIA-860 Data, Schedule 3, 'Generator Data' (Operable Units Only).
79 Arkansas Energy Office, Biomass, accessed January 8, 2017.
80 U.S. Department of Agriculture, 2015 State Agricultural Overview, Arkansas, accessed January 8, 2017.
81 Solar Energy Industries Association, State Solar Policy, Arkansas Solar, accessed January 8, 2017.
82 U.S. EIA, Electric Power Monthly (February 2016), Tables 1.10.B, 1.11.B, 1.15.B.
83 Biomass Magazine, Pellet Plants (May 16, 2016).
84 Biodiesel Magazine, USA Plants, existing (December 12, 2016).
85 American Wind Energy Association, Arkansas Wind Energy, accessed January 8, 2017.
86 Durkay, Jocelyn, "State Renewable Portfolio Standards and Goals," National Conference of State Legislatures (December 28, 2016).
87 Arkansas Alternative Energy Commission, Home, accessed January 8, 2017.
88 American Council for an Energy-Efficient Economy, State and Local Policy Database, Arkansas, updated July 2016.
89 Arkansas Public Service Commission, APSC Sustainable Energy Resources (SER) Action Guide, Docket No. 08-144-U (Little Rock, AR, December 2010).
90 North Carolina Clean Energy Technology Center, DSIRE, Arkansas Energy Efficiency Targets, accessed January 8, 2017.
91 U.S. EIA, Annual Energy Outlook 2016 with projections to 2040, DOE/EIA-0383(2016) (August 2016), p. LR-16.