The Permian Basin | January 2022
Located in West Texas, the Permian Basin has been producing oil for over 100 years. The Permian leads the US in oil production and analysts estimate that there is 43 Gbbl of oil still in the Permian; 80% of reserves in the basin 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
Active Drilling Rigs in Basin- 293 (-)
Total Rigs in Texas- 284 (+7)
Total Rigs in United States- 610 (+24)
Total U.S. Rigs 59% YTD
Top Producer by BOE – Pioneer
Permian Permitting Data
Permits Approved – 504
Regulators such as the RRC have declared a region of the Permian a “Seismic Response Area” (SRA) following a 4.2 magnitude earthquake near the city of Stanton. Disposal wells in that area inject 270,000 bbl/d of saltwater from the surrounding oil and gas operations. The RRC is deciding whether or not to suspend permits for drilling new disposal wells as they are believed to be responsible for this and other earthquakes. While the RRC works with operators to reduce the increase in seismic activity, operators are also busy finding new ways to dispose of wastewater other than deep disposal wells.
Production, supply and demand are all forecasted to reach highs in 2022 as the year begins with a number of large mergers and acquisitions in the Permian basin. Companies such as Abraxas, are selling off their assets outside of Texas to allow themselves more money and time to focus on the USA’s highest producing state. Other companies like Regiment LLC are simply doubling down in Texas, expanding on midstream infrastructure or exploration. Everything seems to be in full swing this month, confirmed by Reuters who says the Permian could reach record highs in February.
Methane is well known to be the worst GHG, which is why dozens of countries are cracking down on their methane emissions, the U.S. included. The Environmental Defense Fund and private company Carbon Mapper have been doing emissions surveys for years and have identified a large source of methane in the Permian. So-called “super-emitters” include well pads, pipelines, and processing facilities which have emitted a disproportionately high amount of methane for how little of oil and gas infrastructure they make up. The good news is that the sources of methane have been located and provide a cheap and easy option for greatly reducing emission levels to hit company, state, and national climate goals.
The U.S. is set to be the largest LNG exporting country in the world, limited by its ability to capacity to handle exports at key sites along the coast. Texas has long been the primary source of hydrocarbons for the U.S. and will continue its legacy of doing so abroad for countries in Europe, India, and China. Major cities across the globe suffer from high rates of pollution in the form of smog, using U.S. LNG will greatly help to reduce the negative impacts that come when these countries burn their current ‘dirty’ from of fossil fuels, typically coal. Not only is natural gas one of the cleanest forms of fossil fuels, the U.S.’s natural gas has the greenest lifecycle due regulations that require producers to comply to high industry standards.
Operators with Highest Permitting
Top Producers By BOE—————————— –
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Counties with Highest Permitting
Texas Oil Production
Texas Gas Production
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