Research firm Rystad Energy said last week that horizontal drilling permits in Permian Basin reached an all-time high of 904 in March. The four-week average increased to 210 for the week that ended April 4 – a record for horizontal permit approvals in the U.S. shale play over four weeks. The Delaware and Midland portions of the basin both contributed to the growing permit activity, although Oil & Gas Journal said only Midland Basin delivered at an all-time high. Pioneer Natural Resources with 99 permits in March and Diamondback Energy with 59 were the basin leaders. At least 81 unique operators received at least one new horizontal drilling permit in Permian Basin in March – another record.
Artem Abramov, head of shale research at Rystad, said, “This is a clear signal that operators in the basin are kicking into high gear on their development plans, positioning for a significant ramp-up of activity level and an acceleration in the speed of output expansion over the next few months once supply chain bottlenecks ease. The surge in permitting activity positions the industry for continuous rig count additions in the second half of 2022 and foreshadows a significant increase in supply capacity from early 2023.”
Petroleum economist Karr Ingham told Houston Chronicle Permian is “the best viable prospect for significant production growth.” He said Permian production shows “pretty impressive growth” and should increase if several obstacles are overcome, including rising costs and shortages of sand, steel and workers.
Expect increased drilling activity in the southern Delaware west into Culberson county
as they prove the massive 7 level shale plays south of IH-10 to the Rio Grand. They’ve
been sitting on the knowledge of the stratigraphy in that area for decades.
westtxlawrence