Sunday, March 12, 2023

Decline in output of nation's largest oil region signals the fracking-driven U.S. oil boom is at its peak, or just past it

Wikipedia map, adapted, highlights Culbertson County
The U.S. oil boom created by horizontal hydraulic fracturing of deep shale beds "is nearing its peak" if it hasn't passed it already, report Collin Eaton and Benoit Morenne of The Wall Street Journal.

"Frackers are hitting fewer big gushers in the Permian Basin, America’s busiest oil patch, the latest sign they have drained their catalog of good wells. Shale companies’ biggest and best wells are producing less oil," the Journal reports. "The average well put out 6% less oil than the prior year, according to an analysis of data from analytics firm Novi Labs."

More recent results from the basin, which stretches across New Mexico and west Texas, "are mimicking the onset of a production plateau that has taken place at other, more mature U.S. shale plays," the Journal reports. "Chevron, one of the largest landholders in the Permian, drilled some of the region’s most prolific wells in Culberson County, Texas, but some of its newer wells there have seen productivity decline. . . . Chevron executives said last week the company missed its oil-production target" in the richest section of the basin. . . Chevron Chief Executive Mike Wirth said last week the rate of production growth and drilling activity the U.S. shale industry saw a decade ago 'is unlikely to be repeated,' though the Permian still has areas that haven’t been developed."

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