Drilling activity in South Texas for 1954 was down 4% from the previous high in 1953, yet was still greater than any other year. Wildcat drilling decreased 6.1% and development drilling decreased 3.2%. However, the 118 discoveries were 7% more than in the previous year and the discovery ratio was raised slightly. No major reserves are indicated from these discoveries, but extensions and new-pays have added considerable reserves. Oil production was down 7% due to decreased allowables. Gas and liquid hydrocarbons produced were up 10%. Production in 1954 amounted to 150,314,031 barrels of oil, 28,113,943 barrels of liquid hydrocarbons, 467 billion cubic feet of casing-head gas, and 1,376.8 billion cubic feet of gas.