Permian – update through September 2020

This is an older blog post, you will find one on more recent data here

These interactive presentations contain the latest oil & gas production data from all 28,739 horizontal wells in the Permian (Texas & New Mexico) that started producing from 2008/2009 onward, through September.

Total Production

Permian tight oil production held steady for the 3rd consecutive month in September, at close to 3.8 million bo/d (after upcoming revisions). This represents a drop in oil output of about 10% since March, which is just half of what the all the other tight basins lost combined (~20%). At 3.2 million bo/d, they produce well below the level in this basin. Permian natural gas production was at an all-time high at nearly 15 Bcf/d.

Supply Projection

Since our last update on this basin in November, 20 more rigs were added to this play, to a total of 165 (source Baker Hughes). Given where these rigs are drilling and the type curves associated with those areas, we project that a production level can be sustained of ~3.1 million b/d, or 300 thousand b/d more than last month. You can see this (and simulate your own rig projections) in  our Supply Projection dashboard by selecting this basin:

Well productivity

Average well productivity has steadily increased in the basin, although the rate of improvements has dropped significantly since 2016 (see “Well quality”). But this does not consider the increase in lateral lengths. Once you normalize for this factor, you will find these results:

It shows that on a normalized basis, results have plateaued at about 12,000 barrels of oil per 1,000 ft lateral in the first 6 months on production, and are recently a little off. This image was taken from the “Productivity over Time” dashboard in ShaleProfile Analytics (Professional). The thickness of the curve represents the relative well count. In this dashboard you can also compare the performance of operators, counties or other basins over time and you can choose your own performance metric to evaluate these wells.

Permit Activity

ShaleProfile is now also closely tracking permit activity in the major tight oil & gas basins. In this chart you can see a ranking of operators in the Permian basins by the number of approved permits to drill new horizontal wells, in the 2nd half of this year:

It shows that EOG has been the most active recently, with almost 350 approved permits since July (all in the Delaware Basin). More information about these permits, including the exact location of these permits in relation to existing wells and expiration dates, can be found in the new “Permit activity” dashboard, available now in ShaleProfile Analytics (Professional). We’re happy to provide trials and demos to understand how you can use this for your benefit.

The ‘Advanced Insights’ presentation is displayed below:

This “Ultimate recovery” overview displays the average production rate for these wells, plotted against their cumulative recovery. Wells are grouped by the year in which production started.

Can you display these results by quarter or month of first flow to see more granular and recent data.

Finally

We will have a new post on the Eagle Ford later this week, followed by a post on Pennsylvania.

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.

Sources

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.
• FracFocus.org

Brief manual

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 individual 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 a 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.

Enno Peters

Enno Peters is General Manager at Novi, where he has build an AI-driven data & analytics platform tailored for oil & gas operators and energy investors. Prior to Novi, Enno founded ShaleProfile which was acquired by Novi late 2021.