Credit to our friends in West Texas for the attached news about increased oil production. This confirms our personal and independent conversations with producers who tell us that "activity is up, and the Permian Basin is hot again." Wow, the ups and downs of the oil industry! BBB BootheGlobalPerspectives
After several months of declining production, crude oil output from the Permian Basin in West Texas and southeastern New Mexico is again expected to increase in September, according to the U.S. Energy Information Administration. The latest Drilling Productivity Report forecasts production in September to increase by 3,000 barrels per day to 1.977 million b/d in the Permian, the only one of seven major shale plays expected to grow. Overall, crude oil production is expected to decline 85,000 b/d in September to 4.47 million b/d.
Shale gas production is expected to decline 373 MMcfd to 45.45 bcfd. The report also follows production in Bakken, Eagle Ford, Haynesville, Marcellus, Niobrara and Utica.
The Permian Basin continues to hold more than 80 percent of working oil and gas drilling rigs in Texas and is again nearing the benchmark of 200 rigs. Houston-based oilfield services firm Baker Hughes reported as of Aug. 19 an increase of seven rigs in the last week to 196 – 39.9 percent of rigs in the U.S. and 82.4 percent of rigs in Texas. There were 253 rigs in the Permian Basin a year ago. The last time the count was at least 200 was Jan. 15 with 202 rigs (31.1 percent of rigs in the U.S., 67.1 percent of rigs in Texas). This was the 10th consecutive week of gains for the Permian – growing 54 rigs from 142 in that period.Also as of Aug. 19, there were 238 rigs in Texas (up eight in the last week) and 491 rigs in the U.S. (up 10 in the last week). A year ago, there were 383 rigs in Texas and 885 rigs in the U.S.The other top states are Oklahoma at 62 (up one in last week, down 44 in last year), Louisiana at 43 (up one in last week, down 34 in last year), New Mexico at 30 (down one in last week, down 22 in last year) and North Dakota at 27 (down two in last week, down 45 in last year). The loss of one rig in New Mexico ended six weeks of gains when the state went from 19 to 31 rigs (all in the Permian). There were 52 rigs in New Mexico a year ago.The other top plays are Eagle Ford at 36 (unchanged in the last week, down 63 in last year), Cana Woodford at 32 (up three in the last week, down seven in the last year), Williston at 27 (down two in the last week, down 46 in the last year) and Marcellus at 24 (up three in the last week, down 28 in the last year).