Texas Rig Permitting Has Doubled Thanks to Permian Shale

About half all active oil and gas rigs in the country are located in the country are located in Texas and that number appears to be growing thanks to the Permian Shale region.

The licensing and regulating arm of the oil and gas industry, the Texas Railroad Commission, issued 1,011original drilling permits in July 2017.  That is compared to 631 in July 2016.

Of the 1,011 new permits, 893 permits to drill new oil or gas wells, 10 to re-enter plugged well bores and 108 for re-completions of existing well bores. The breakdown of well types for those permits issued July 2017 included 273 oil, 77 gas, 601 oil or gas, 53 injection, zero service and seven other permits.

In July 2017, Commission staff processed 437 oil, 50 gas, 27 injection and two other completions compared to 568 oil, 243 gas, 44 injection and one other completions in July 2016.

While the permits are up the well completions are down. Currently4,388 have been processed for 2017 which is down from 7,285 recorded during the same period in 2016.

According to Baker Hughes Inc., General Electrics Oil and Gas arm, the Texas rig count as of August 4 was 466, representing about 49 percent of all active rigs in the United States.

San Antonio has the largest amount of rig completions and permits last month with 120 total permits 54 oil and 12 gas rig completions.

The U.S. Energy Information Administration (EIA) believes that Texas shale is the most productive in the nation.

The Permian Shale and Eagle Ford region combine to produce 3.88 million barrels of oil each day. That is up about 2.5 percent for Permian Shale and two percent for Eagle Ford.

While output over all is up but the production per rig is down because many are started rigs but not bringing them to completion. The calculations of per rig output includes the non-completed wells.

The Permian Shale is expected to reach 30% of all U.S. oil production by next year keeping the Texas economy on track for years to come.

 

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