Permian Basin Rig Count Explodes

Apache Corp. Drilling In Andrews County, TX

Introduction…The most attractive oil exploration and production region in the United States and perhaps the world has added 101 active drilling rigs since just May 13, 2016. That’s a giantic 84% gain in rigs in just in seven months.

The Permian basin in West Texas and southwestern New Mexico which is 250 miles wide and 300 miles long has become the most attractive drilling region due to the major infrastructure that reduces time and expense to getting oil and gas to the market.

The first commercial oil well in the Permian Basin was completed in 1921 in Mitchell County, on the east side of the basin; completed at a total depth of 2,498 feet, it was the discovery well of the Westbrook field.

With the coming of World War II the need for oil was urgent, and it became economically justified to drill more and deeper tests.

The entire Permian Basin during 1966 produced a total of 607 million barrels of oil and 2.3 trillion cubic feet of gas for a total of $2 billion. A cumulative total of 11.3 billion barrels of oil had been produced.

Conclusion...Intrastate and interstate gas pipeline systems were expanded throughout the area, and Midland-Odessa was the headquarters for the oil and gas industry in the Permian Basin area. Hundreds of millions of dollars have been spent on petrochemical refineries and supplemental construction work in the Permian Basin, which was rated the largest inland petrochemical complex in the United States. Is it no wonder the Permian basin is the most attractive oil exploration and production region in the United States and perhaps the world?

Take away...One business that benefits greatly from the new oil exploration and development is the saltwater disposal wells. These properties tend to have a consistent cash flow and a short payback period. Drop me a note if this intrigues you.