Large Players Ramping Up Shale Production

WSJ: Oil Giants Start to Dominate U.S. Shale Boom

Some good stats and soundbites here on US onshore shale production.

Chevron’s output in the Permian Basin of Texas and New Mexico rose 80% for the year ended in September, eclipsing some of the small producers that spent years building up their fracking positions.

While many big oil companies were slow to fracking, bigger companies have tended to benefit as technology matures and drillers shift from exploration to large-scale production.  That trend is most apparent in the Permian Basin. Large companies including Exxon, Chevron, BP, Shell and Occidental this year are set to produce an average of about 600,000 barrels a day of crude in the region, up 54% from last year. By 2021, their output there will exceed 1.1 million barrels a day, or about 20% of the area’s total shale-related output, according to consulting firm Rystad Energy.

Pipeline access is another area where bigger companies fared better. As U.S. oil production soared above 11 million barrels a day, growth exceeded existing pipelines, forcing smaller companies to sell their oil at a discount. Crude sold in the Permian Basin was discounted by an average of $14 a barrel during the third quarter, according to S&P Global Platts. That differential has since contracted to about $5.

3 thoughts on “Large Players Ramping Up Shale Production

  1. Just to get you a little more excited.. Anadarko (APC) gave an ops update last night highlighting what they call their Silvertip Area.. They are putting up some monster wells in this area with one of the wells that has been on the longest producing 375k boe in its first 80 days.. Looking at one of the slides that APC has in their presentation (slide 16) there is a map that shows where these wells are located.. Looking at a side by side comparison of TPL’s roaylty acres in that area it clearly looks like these wells are being drilled on TPL’s acreage, if so it should be a huge positive for future production growth from TPL. I would post the pictures of the maps but it doesn’t seem to be allowing me to..

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