• 6 minutes WTI @ 67.50, charts show $62.50 next
  • 11 minutes Saudi Fund Wants to Take Tesla Private?
  • 17 minutes Starvation, horror in Venezuela
  • 2 hours Desperate Call or... Erdogan Says Turkey Will Boycott U.S. Electronics
  • 2 hours The EU Loses The Principles On Which It Was Built
  • 42 mins Crude Price going to $62.50
  • 6 hours Anyone Worried About the Lira Dragging EVERYTHING Else Down?
  • 11 hours Oil prices---Tug of War: Sanctions vs. Trade War
  • 11 hours Correlation does not equal causation, but they do tend to tango on occasion
  • 11 hours Russia retaliate: Our Response to U.S. Sanctions Will Be Precise And Painful
  • 6 hours Why hydrogen economics is does not work
  • 13 hours Monsanto hit by $289 Million for cancerous weedkiller
  • 19 hours WTI @ 69.33 headed for $70s - $80s end of August
  • 19 hours WSJ *still* refuses to acknowledge U.S. Shale Oil industry's horrible economics and debts
  • 17 hours Saudi Aramco IPO Seems Unlikely
  • 3 hours < sigh > $90 Oil Is A Very Real Possibility
Global Energy Advisory – 10th August 2018

Global Energy Advisory – 10th August 2018

U.S. shale producers have been…

The Real Reason Behind The Next Oil Squeeze

The Real Reason Behind The Next Oil Squeeze

An oil supply squeeze may…

Chevron To Invest $4B In Permian Production

Permian

Chevron will invest some US$4 billion in 2018 to increase its crude oil output in the Permian, a senior Chevron manager said at a conference on Monday, in a sign that the U.S. supermajor will continue to bet big on the most prolific U.S. shale play.

“We will be investing roughly $4 billion, next year, of capital in the Permian Basin, and we plan to grow production over the next several years to well in excess of 400,000 bpd,” Ryan Krogmeier, Chevron’s vice president of crude supply and trading, said at the S&P Global Platts APPEC conference in Singapore, as quoted by Reuters.

“The Permian is the powerhouse [of U.S. oil production growth]”, Krogmeier noted.

According to Reuters, Chevron expects total Permian output from all producers operating in the shale play to increase by 1.4 million bpd by 2020, from 2.4 million bpd now.

The Permian oil production will average 2.580 million bpd in September 2017, and will rise by another 55,000 bpd to 2.635 million bpd in October, the EIA said in its latest drilling productivity report.   

As early as in April this year, Chevron’s chief executive John Watson said that the U.S. supermajor would be betting big on the Permian. Chevron’s production in the Permian was 90,000 net barrels of crude oil per day in 2016. Watson expects the company’s output in the shale play to increase eight times over the next decade and reach 700,000 bpd.

Related: OPEC’s Premature Victory Lap

Unlike some other producers who have just recently rushed to secure holdings in the shale play, Chevron is not a newcomer to the Permian – the group and its legacy companies have held acreage in the area since the early 1920s. Chevron’s acreage in the shale play amounts to 2 million net acres, of which 85 percent is free of royalties to landowners or have low royalties.

Chevron planned to spend around US$2.5 billion on shale and tight investments in 2017, the majority of which was slated for the Permian Basin, a 67-percent increase over last year. In the upstream investments for 2017, the funds for the Permian were second only to the US$3-billion investment in the expansion of the Tengiz field in Kazakhstan.

By Tsvetana Paraskova for Oilprice.com

More Top Reads From Oilprice.com:



Join the discussion | Back to homepage

Leave a comment
  • Brandon on September 25 2017 said:
    What a huge mistake to invest in shale now, possibly the first sign of the post-John Watson era for Chevron. They should have invested longer on deepwater drilling instead! Sorry to hear that, good news for their competitors.
  • Kr55 on September 25 2017 said:
    Guess they have a responsibility to stick to their plan and try to hype it up as much as they can. Just wouldn't want to risk my investments on when they have to sheepishly reveal decline rates are much higher than they expected and the growth is coming way below their targets next year.

Leave a comment

Oilprice - The No. 1 Source for Oil & Energy News