The Permian Basin | July 2020
Field Overview
Located in West Texas, the Permian Basin has been producing oil for over 100 years. It leads the US in oil production and estimates put 43 billion bbl of oil still in the Permian; 80% of those reserves are believed to be at less than 10,000 feet. Some top formations are the Wolfcamp, Upper/Lower Spraberry, and the Leonard.
State Drilling Statistics (End of July)
Active Drilling Rigs in Basin- 124
Total Rigs in Texas- 101
Total Rigs in United States- 251
Total U.S. Rigs down 73% YTD
Permian Top Producers
Top Oil Producer – Diamondback Energy
Top Gas Producer – Cimarex Energy
Financial & Economic Updates
–
Not a lot of financial information to be presented this month within the Permian outside of mass restructuring. Please navigate to the periodicals page, or listen to a podcast that we have uploaded recently to supplement your knowledge of the industry in the present.
–
State Highlights
Trump Visiting the Permian to Boost Morale
Trump took time in the end of July to personally fly down to the Permian basin to raise spirits and rally oil and gas workers against Democrats. Trump assured them, “We are telling the Washington politicians trying to abolish American energy: Don’t mess with Texas.” These comments serve both as a policy announcement and a campaign speech as Biden eases closer to 50% in the polls. Accommodating his uplifting remarks, there were menacing statements about the “radical left… is fighting to abolish American energy, destroy the oil and gas industries, and wipe out your jobs.” As it stands, Biden is in support of the Green New Deal which would ban all oil and gas drilling on federal lands, but mentions how he does not support a total fracking ban. With over 40,000 of Texas’s energy sector employees unemployed, these messages could mobilize big change in the way Texas votes come November.
New Mexico and Texas Disagree on Flaring
While the EPA has taken a step back from flaring regulation, there is a question as to who and how will be pursuing it moving forward. Enter the Permian Basin and its two largest players: Texas and New Mexico. For New Mexico, state methane rules are inbound as Governor Michelle Grisham has pledged her administration will define nation-leading regulations by the end of this year. Many in the state feel that these rules are becoming a more pressing matter as federal rollbacks for the oil and gas industry continue to pour out of the White House. While New Mexico has been vocal about their plans, Texas seems to have remained silent thus far. Historically, Texas has been very lenient with its flaring and emissions laws. Federal laws were the biggest guideline they had, and many fear that Texas will see this change in regulation as an opportunity to have free reign over burning as much gas as they see fit. Fortunately, a few smaller companies and organizations have come together to promote the creation of methane guidelines for Texas as they want to retain their social license to operate.
Top Oil Producers (2020 cum)
| Rank | Company | Production (Bbl) |
| 1 | Diamondback | 32,470,703 |
| 2 | Pioneer | 31,648,042 |
| 3 | XTO | 22,570,091 |
| 4 | COG | 19,296,232 |
| 5 | Endeavor | 14,845,243 |
Top Gas Producers (2020 cum)
| Rank | Company | Production (Mscf) |
| 1 | Cimarex Energy | 95,911,069 |
| 2 | Apache Corp | 77,304,110 |
| 3 | Anadarko | 70,618,393 |
| 4 | Chevron | 53,504,264 |
| 5 | EOG | 45,330,778 |
Refining
Texas Oil Production
Texas Gas Production
Click above to subscribe to the RARE
PETRO Podcast Network or visit
www.rarepetro.com/newspulse
The information contained in this newsletter is provided by RARE
PETRO Engineering, PLLC via the following sources unless otherwise
noted:
www.eia.gov
www.drillinginfo.com
www.bhge.com
RARE Petro Analytics