The prolific Permian Basin, a mature hydrocarbon “super basin” located in West Texas and Southeastern New Mexico, reached a new oil-production record of 815 million barrels or more in 2017 — far exceeding its previous peak of 790 million barrels set in 1973, according to new analysis from IHS Markit.
The 2017 production milestone did not just crawl past the previous 1973 peak, but eclipsed the 44-year-old previous record by more than 25 million barrels, IHS Markit said.
“The magnitude of the rebound in Permian Basin liquids production is unprecedented,” said Reed Olmstead, director, energy research and analysis, IHS Markit. “Not so long ago, many in the industry were saying the Permian was dead, but the Phoenix has again risen from the ashes and is soaring to new heights.”
According to the IHS Markit U.S. Energy Well and Production database, peak monthly liquids production for the Permian during 1973 was an average of nearly 66 million barrels of oil per month. Peak-month liquids production in the Permian during 1973 occurred in September, with slightly more than 68 million barrels produced.
By mid-year 2017, average monthly production already had exceeded the best month of Permian production in 1973. For 2017 year-to-date through July, Permian liquids production exceeded 484 million barrels, or an average of slightly more than 69 million barrels per month.
Longer-term implications for Permian Basin oil supplies are evolving, and the future looks promising, according to IHS Markit energy researchers, who have completed the first three-year phase of a massive Permian Basin research project titled, “The Permian Basin Interpreted in 3D: The IHS Markit Permian Basin Unconventionals Kingdom Geology Project.” It models and interprets the giant basin’s key geologic characteristics to better estimate its remaining hydrocarbon potential, and initial results indicate the giant basin still holds an estimated 60 billion-70 billion barrels of technically recoverable resources — about twice as much as the cumulative oil production to date.
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