The Permian Basin has long been touted as the fastest growing shale play in the United States, but now its oil-producing prowess is being highlighted again as the Energy Information Administration forecasts the prolific basin’s May production to be 3.183 million bpd—an expected 73,000 bpd rise from April.
The Permian play may very well, as Bloomberg Markets suggests, become the largest oil patch in the world over the next decade.
If The Permian Was Part of OPEC
The United States is quickly become a major contender for top oil producer in the world, producing 10.540 million bpd as of week ending April 13. That’s more than Saudi Arabia (9.934 million bpd as of the latest MMOR), and just a hair below that of the world’s top producer, Russia, who produced 10.97 million bpd in March 2018, according to Russia’s Energy Ministry.
Besides OPEC’s powerhouse Saudi Arabia, the next largest OPEC producer is But the Permian alone, with its expected production of 3.183 million bpd next month Iraq at 4.426 million bpd, followed by Iran at 3.814 million bpd. If the Permian were part of OPEC, it would be its number three producer.
And unlike Iraq and Iran which have production quotas to contend with as part of their OPEC duties, for the Permian, the sky is the limit, constrained only by the size of its massive reserves. Even when prices were low, oil production increased in the Permian, increasing every month but three from January 2016 to March 2017, according to the EIA.
On top of the Permian’s large reserves, technology has played a major role in helping the Permian achieve its high marks.
“The technology is the biggest driver,” said Rob Thummel, managing director and Portfolio Manager – Energy at Tortoise, which handles $16 billion in energy-related assets. “The basin in and of itself could end up being the largest oil field in the world."
By Julianne Geiger for Oilprice.com
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