Permian – update through June 2019
09 / 26 / 2019
These interactive presentations contain the latest oil & gas production data from all 22,877 horizontal wells in the Permian (Texas & New Mexico) that started producing from 2008/2009 onward, through June 2019.
June production came in at just over 3.3 million bo/d, which after upcoming revisions will get close to 3.5 million bo/d. That would represent a growth of about 200 thousand bo/d in the first 6 months, which is significant, but well under the growth rate in the past 2 years. Since the beginning of the year, the horizontal rig count has dropped by 14% (from 443 to 383), which is now starting to make an impact. Gas production, most of it associated with oil production, was nearly 12 Bcf/d in June.
After major strides in performance in the years 2013-2016, well productivity is up only slightly in the past 3 years, as you can find in the “Well quality” tab.
Normalized for the increase in lateral lengths, well results have not increased since 2016, as you can see in the following image, which was taken from our advanced analytics service:
Pioneer Natural Resources produced almost as much as Concho, the number 1 in the basin (“Top operators” dashboard).
The ‘Advanced Insights’ presentation is displayed below:
This “Ultimate recovery” overview shows the average production rate for these wells, plotted against their cumulative recovery. Wells are grouped by the year in which production started.
After 2.5 years, the 2,271 horizontal wells that began production in 2016 recovered on average 206 thousand barrels of oil, in addition to 0.6 Bcf of natural gas. Their average production rate fell in this period from almost 600 bo/d to just below 100 bo/d.
Last week we held a webinar (our first!) on Terminal Decline Rates. We analyzed these rates for the major tight oil and gas basins, using a new dashboard in our analytics service. Here you can find the average annual production rate and decline rates, for all the horizontal oil wells that started in the Permian since about 2010.
As you can see in the tooltip, the average annual decline rate from year 1 to year 2 is 56%. After year 7, this annual decline rate has fallen to 10%. This dashboard also allows you of course to analyze this data for specific counties, operators, or by well vintage.
Early next week we will have a post on the Eagle Ford.
Production data is 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 proration 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 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.