After a few months hiatus, we’re now back with regular updates on unconventional developments in all the major US tight oil & gas basins!
This interactive presentation contains the latest oil & gas production data from all 37,174 horizontal wells in the Permian (Texas & New Mexico) that started producing from 2007/2008 onward, through May.
Permian tight oil production rose to a new output record in May, at around 4.6 million b/d (after upcoming revisions, horizontal wells only). Not all this production is reported yet by the state agencies, thus the apparent drop in production in the above chart. Natural gas production rose as well, to over 18 Bcf/d. You can view this by toggling the ‘Product’ selection to gas.
As you can see, the increase in drilling activity appears to have halted now that oil prices have come down from recent highs. Currently, 60% (323 out of 543) of the rigs drilling for horizontal oil wells are active in the Permian Basin.
The following dashboard shows output in the top-10 producing counties in the Permian Basin:
Unconventional production in Eddy County (NM) just surpassed Midland. The graph also shows that although production is still growing in some counties, it has stagnated or fallen in others, notably Reeves.
In the “Well quality” tab, the production profiles for all the horizontal wells in the Permian Basin can be found. Here we also share how well performance in the top 3 oil-producing counties has developed over the past decade:
The top chart reveals that well productivity, as measured by the cumulative oil recovered during the first year of production, has increased significantly over time, from 50-80 thousand barrels of oil in 2012, to around 200 thousand barrels of oil for wells coming online last year. However, you can also see that productivity has stagnated in Midland County, even before taking into account that laterals have slightly increased during the last few years, as shown in the 2nd chart from the top.
Production and completion data are subject to revisions.
Note that a significant portion of production in the Permian comes from vertical wells and/or wells that started production before 2008, which are excluded from these presentations.
For these presentations, I used data gathered from the following sources:
- Texas RRC. Oil production is estimated for individual wells, based on a number of sources, such as lease & pending production data, well completion & inactivity reports, regular well tests, and oil production data.
- OCD in New Mexico. Individual well production data is provided.
The above presentations have many interactive features:
- You can click through the blocks on the top to see the slides.
- Each slide has filters that can be set, e.g. to select individuals or groups of operators. You can first click “all” to deselect all items. You have to click the “apply” button at the bottom to enforce the changes. After that, click anywhere on the presentation.
- Tooltips are shown by just hovering the mouse over parts of the presentation.
- You can move the map around and zoom in/out.
- By clicking on the legend you can highlight selected items.
- Note that filters have to be set for each tab separately.
- The operator who currently owns the well is designated by “operator (current)”. The operator who operated a well in the past month is designated by “operator (actual)”. This distinction is useful when the ownership of a well changed over time.
- If you have any questions on how to use the interactivity, or how to analyze specific questions, please don’t hesitate to ask.
Hi Enno. Seems an awful lot of the growth in the last 15-18 months has been from depletion of DUCs. As those reach balance, seems to me production growth will be significantly more difficult to achieve? Am I missing something?
Indeed a depletion of the DUC inventory has been a contributing factor to the growth seen in the Permian basin. However, if one assumes a constant rig count, constant rig efficiency and no change in well productivity, more output growth in the Permian would lie ahead, as below image from our Supply Projection dashboard shows (notice the drop in well completions, as we assume no further changes in DUCs).
However, I think the key question is whether those assumptions will hold with the fall in prices, and with the challenges to maintain well productivity.
Thank you very much Enno. Still not sure I completely understand, but my knowledge base is pretty limited. Much appreciate you getting back to me.