Permian – update through September 2019

These interactive presentations contain the latest oil & gas production data from all 24,446 horizontal wells in the Permian (Texas & New Mexico) that started producing from 2008/2009 onward, through September 2019.

[2019-12-24 Some adjustments were made to the presentations and text, as more recent data for NM was added]

The Texas RRC published production data early this month, and now most wells in the Permian are already reported through October in our subscription services.

September oil production set another record, at around 3.8 million bo/d (after upcoming revisions). Natural gas production rose even faster in the past 2 years, to over 13 Bcf/d (switch “Product” to gas to see this).

Not normalized for the increases in lateral length, well productivity is slightly up in the last 3 years, as you’ll find in the “Well quality” tab. The following image, taken from our advanced analytics service, shows that on a normalized basis (for lateral length), well results have not improved since 2016.

Of course, these are average results, which hide a large variation between locations and operators. EOG is one of the major operators that is experiencing a severe decline in its well performance in this basin. The following screenshot shows a deterioration in average well productivity since 2016, after normalizing for lateral length (also without normalizing):

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.

In the 9th tab (“Gas oil ratio”), you can see how the gas/oil ratios (GORs) are changing over time (top chart), and the overall GOR for the basin (bottom chart). It shows that the GOR has steadily increased from early last year, from 3.0 Mcf/bbl, to 3.6 Mcf/bbl in September this year. This will likely increase further, with GORs going up over time, especially with the slowdown in completion activity (new wells start at a low GOR).

Finally, with the recent announcement that WPX will acquire Felix for $2.5 billion, I thought it would be interesting to show you how these operators are currently performing in the Delaware basin. In this screenshot, taken from ShaleProfile Analytics., you will find the ranking of all Delaware operators with at least 10 operated horizontal wells, by their average cumulative oil recovered in the first 24 months. The map shows you the location of all these wells, colored by the same metric:

It is important to note that changing your selection or this metric can have quite a significant effect on these results.

Early 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.