Permian – update through August 2019

These interactive presentations contain the latest oil & gas production data from all 23,839 horizontal wells in the Permian (Texas & New Mexico) that started producing from 2008/2009 onward, through August 2019.

Preliminary data from the state agencies already has August production at a record high (see chart above). After revisions, especially for New Mexico, I expect that August production will be revised upward to about 3.7-3.8 million bo/d.

Although the horizontal rig count has fallen by 15% since the start of this year (443 to 377 in the previous week), if current drilling & completion activity and well productivity would stay constant (which they never do), production has the potential to double from current levels over time. This simple projection obviously ignores many possible constraints that could occur on the way.

The “well quality” tab does show that improvements in well performance have flattened since 2016. As observed in previous posts on this basin, after normalizing production data for the increases in lateral length (which is easily done in our advanced analytics service), we see no improvement since Q2 2016.

Pioneer overtook Concho in the “Top operators” overview in August. However, since the acquisition of Anadarko, Occidental is now the largest operator in the Permian (we still list both entities separately), with well over 300 thousand bo/d of operated production.

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.

In previous posts we shared the operators with the best performing wells. In the following screenshot, you can find this ranking for the Permian Basin, based on the average cumulative oil produced in the first 2 years on production. Only horizontal oil wells are included that began production since 2012. Operators are only shown if they completed at least 20 wells in the selected time frame.

 

Well productivity ranking for all medium/large operators in the Permian. Horizontal oil wells with production start since 2012 only.

Click on the image to see a high-resolution version, which was taken from ShaleProfile Analytics. Resolute, which was last year acquired by Cimarex, shows the best results, with an average of 250 thousand barrels of oil in the first 2 years.

In the middle of next week, we will have a new post on the Eagle Ford.

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.
  • 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.

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