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Permian - update through May 2019

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This article contains still images from the interactive dashboards available in the original blog post. To follow the instructions in this article, please use the interactive dashboards. Furthermore, they allow you to uncover other insights as well.

These interactive presentations contain the latest oil & gas production data from all 22,473 horizontal wells in the Permian (Texas & New Mexico) that started producing from 2008/2009 onward, through May 2019.

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The chart above shows the almost 15-fold increase in oil production from horizontal wells in the Permian, in the last 6.5 years. Preliminary May production came in at just over 3.3 million bo/d, which will probably rise to close to 3.5 million bo/d once all revision data is in. Gas production from these wells is already over 11 Bcf/d (switch ‘Product’ to gas).

In the ‘Well quality’ tab you will find the production profiles for all these wells. It makes clear how well productivity, not normalized for the increases in lateral lengths or proppants, has increased over the years. New wells peak at over 700 bo/d and decline to 100 bo/d in about 2.5 years, on average. At this point, they have recovered around 220 thousand barrels of oil.

Concho is still the leading operator in the area (“Top operators” tab), but EOG, the number 3, is rapidly catching up.

However, as the following screenshot from our advanced analytics service reveals, this Delaware Basin player has seen lower well productivity in the last 2 years:

EOG-in-Permian.thumb.png.0efbc6abf8c254b4b76508220ea053b6.png

You can click on the image to see it in high resolution. The map shows the location of all the 1,127 horizontal wells that EOG operates here. On the right side, the performance of these wells is shown. It started to complete more wells in the last 2 years (shown by the thickness of the curves), but these wells are tracking a lower oil recovery. If you normalize these well results by lateral length (or proppants), which is possible in this dashboard, this effect is even more pronounced. Newer wells appear then to underperform even the wells that began production in 2015. Interestingly, peak rates have been less impacted as you can see. This shows the danger of using peak rates in judging well quality.

The ‘Advanced Insights’ presentation is displayed below:

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This “Ultimate recovery” overview shows the average production rate for these wells, plotted against their cumulative recovery. Wells are grouped by the year in which production started.

The 2nd tab, “Cumulative production ranking”, ranks all counties by cumulative oil production from horizontal wells. Reeves is the number one, with over 420 million barrels of oil since early 2018.

The data in our subscription service indicates that lateral lengths are still increasing in this basin. In early 2013, they were at 6 thousand feet, on average, while in June they increased to about 9 thousand feet. However, several operators have started to reduce proppant volumes, which dipped in the 2nd quarter, based on preliminary completion data.

If you would like to try out our online analytics service, you can do so in just seconds away from now. Simply sign up here and start right away: start my ShaleProfile Analytics trial. If you already requested a trial in the past, but it was more than 6 months ago, I can grant you a new one. Just contact us about it here: Contact form

Early next week we will have a post on the Eagle Ford.

Production data is 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.

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 proration data.
  • OCD in New Mexico. Individual well production data is provided.
  • FracFocus.org

 

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