Permian Not on Its Way Out
A handful of industry insiders have speculated that the Permian may be on its way out, noting that well productivity in the region is declining.
That is what Rystad Energy highlighted in a company statement posted on its website on the 2nd August.
The energy research company emphasized in the statement, however, that the truth is “quite the opposite”.
“Some market participants argue that the average well performance in the Permian is already declining, based on speculations of depletion of core inventory, as well as a growing share of child wells and well spacing challenges,” Rystad Energy said in the statement.
“After careful analysis, we do not find sufficient evidence in the data to support these speculations,” Artem Abramov, Rystad Energy’s head of shale research, added in the statement.
“We conclude that the average new production per well in the basin matches the all-time highs seen in early 2019, despite depletion concerns,” Mr Abramov continued.
Abramov went on to state that a typical horizontal Permian well currently produces approximately 830 barrels of oil per day during its second month of production, which is an “all-time high level”.
Earlier this year, Regina Mayor, global sector head of energy and natural resources for KPMG, revealed in a television interview with Bloomberg that she thought “Permania” was alive and well and here to stay.
In a separate television interview with Bloomberg back in January, Fatih Birol, executive director at the International Energy Agency, said, “we have not seen the full impact of the shale revolution yet”.
“There is more to come both for oil and gas and it will have huge implications for the oil industry, gas industry and the markets,” Ms Birol told Bloomberg in the interview.
Rystad Energy describes itself as an independent energy research and business intelligence company. Last week, the research business revealed that US fracking is poised to enter the second half of 2019 “with gusto”.
Source: Rigzone