Reuters reported last week that producers in U.S. shale fields are stockpiling drilling permits on federal land ahead of the presidential election Nov. 3 “concerned that a win by Democratic candidate Joe Biden could lead to a clamp-down on oilfield activity.” Federal permitting in Permian Basin was up 80 percent in the last three months as of Aug. 24 which Reuters said “analysts attribute to a hedge against a win by Biden, who currently leads President Donald Trump by several points in national polling… (Biden’s) climate plan includes banning new oil and gas permits on public lands.”
According to data from Enverus, as of Aug. 24 producers have received 974 permits so far this year for new wells on federal land in Permian Basin compared to 1,068 for all of 2019 and 265 in 2018. The scramble for permits comes despite the weak oulook for oil drilling and prices because of the coronavirus pandemic. And Bernadette Johnson of Enverus said more permits will be filed before the election. Reuters added, “The industry has raced to file for permits before ahead of potential regulatory changes.”
The race for permits is centered in Permian Basin in New Mexico, where 85 percent of permits and 65 percent of production this year have been on federal lands. Matador and EOG have been among the most active companies in filing on federal acreage along with Cimarex Energy and Devon.