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DW Monday: Permian Basin Opportunities

By September 9, 2013 November 28th, 2019 No Comments

DW MondayRevenue and investment opportunities in the Permian basin are becoming increasingly difficult to ignore. The Permian accounts for 22% of drilling activity in America, and although a mature region, new hydraulic fracturing technologies and horizontal wells have allowed operators to return and unlock vast resources with strong growth set to continue.

Major players ConocoPhillips, Apache Corp and Chevron are already well positioned. The Permian is producing one million barrels of oil per day and total rig count has risen from 51 in 1999 to 442 units. The opportunities are substantial due to “stacked-pay zones” layered on top of each other, allowing producers to tap oil at varying depths from a single vertical well. The Bonespring and Wolfcamp plays epitomize this idea. Together, the two could pump one million barrels of oil per day by 2018. Investment in the Bonespring is expected to reach $145 billion, while $75 billion Capex is expected on the Wolfcamp. And then there’s the Cline. In addition to drilling deeper and using more fracturing stages, enhanced recovery techniques are gaining share, including waterflooding and advanced injection services. Now might be the time to consider focusing in the Permian.

R. Michael Haney, Douglas-Westwood Houston
+1 713 385 2588 or mike.haney@douglaswestwood.com