Visualizing Permian Oil & Gas Production (Through August 2021)

Total Production

Permian tight oil production is slowly accelerating and in August rose to about 4.2 million b/d (after upcoming revisions, horizontal wells only), the highest since April 2020 and less than 300 thousand b/d below the peak in March 2020. Natural gas production is already setting new records every month, and came in at 16.6 Bcf/d in August.

Supply Projection

The horizontal rig count in the basin has increased to 258 as of last week (according to Baker Hughes), which is already sufficient to sustain further growth in the coming months and years, assuming that well & rig productivity can be maintained:

Tight oil outlook in the Permian, by state, based on a constant horizontal rig count of 258 and current well/rig productivity.

This image was taken from our Supply Projection dashboard.

Completion designs

Well productivity in the US tight basins has greatly changed in the past 2 decades, especially driven by longer laterals and larger proppant loadings. Here we show how these 2 parameters have changed in the Permian Basin:

Completion designs in the Permian Basin

This year, wells were completed with 20 million pounds of proppants, on average, for the first time. However, as laterals increased in proportion to proppant loadings since 2018, the proppant intensity (proppants / lateral length) has hovered around a level of 2 thousand pounds per lateral ft since 2017, as the bottom chart reveals.

Well productivity

In this post we’ll take a closer look at well productivity trends in the southern part of the Delaware basin:

Well productivity in the southern part of the Delaware Basin. Horizontal oil wells with a first production start >= 2014 only.

On the map you can find the almost 8 thousand horizontal wells included in our analysis, by county. On the right, you can find the production profiles for these wells, by vintage year of first production, normalized by lateral length (rate vs. cumulative production, per 1,000 ft of lateral length).

As you can see, well productivity as measured by this metric has fallen since 2016.

This could be an explanation of why production has fallen sharper in Reeves and Loving, compared with other top-producing counties in the Permian Basin:

Tight oil production in the top 6 counties in the Permian Basin

Finally

We will have a new post on the Eagle Ford later this week.

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.

Sources

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