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Boom Stresses Expose Rich Permian Opportunities

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document.getElementById("rotatortwo").style.backgroundImage = "url(" + dir + images[randomCount] + ")"; </script> <div class="container content"> <div class="row"> <div class="col-lg-9 col-md-9 padright"> <p style="font-size:11px;margin-top:30px;">Wednesday, May 14th, 2014 and is filed under <a href="https://web.archive.org/web/20211205210449/https://www.arescotx.com/category/new-mexico-oil-and-gas-investing/" rel="category tag">New Mexico Oil and Gas Investing</a>, <a href="https://web.archive.org/web/20211205210449/https://www.arescotx.com/category/texas-oil-and-gas-investing/" rel="category tag">Texas Oil and Gas Investing</a></p> <p><a title="Permian Basin Energy Production" href="https://web.archive.org/web/20211205210449/https://www.arescotx.com/permian-rising-booming-energy-production-driving-tx-nm-economies/permian-basin-energy-production/" target="_blank" rel="attachment wp-att-3586"><img loading="lazy" class="alignleft wp-image-3586" style="border: 0px none; margin: 5px 10px;" src="https://web.archive.org/web/20211205210449im_/https://www.arescotx.com/wp-content/uploads/permian-basin-energy-production-300x225.jpg" alt="Permian Basin Energy Production" width="240" height="180" srcset="https://web.archive.org/web/20211205210449im_/https://www.arescotx.com/wp-content/uploads/permian-basin-energy-production-300x225.jpg 300w, https://web.archive.org/web/20211205210449im_/https://www.arescotx.com/wp-content/uploads/permian-basin-energy-production.jpg 600w" sizes="(max-width: 240px) 100vw, 240px"/></a>Increasing oil and gas production from the Eagle Ford formation and the Permian Basin has propelled Texas passed yet another petroleum milestone. If it were its own “kingdom,” the Lone Star State would rank as the <a title="Oil and Gas Boom in Texas" href="https://web.archive.org/web/20211205210449/http://www.forbes.com/sites/davidblackmon/2014/01/09/oil-gas-boom-2014-a-great-time-to-be-a-texan/" target="_blank">9th largest oil-producing nation in the world</a>.</p> <p>Texas leapt passed oil giants like Nigeria, Mexico, Kuwait, Brazil and Venezuela moving solidly into the oil producing top ten in the twelve months preceding September 2013. Texas is on deck to surpass OPEC giants Iran, Iraq, and the United Arab Emirates if current production trends maintain their momentum.</p> <p>Much of this success is owing to the geologically opportune <strong><a title="Permian Basin" href="https://web.archive.org/web/20211205210449/https://www.arescotx.com/tag/permian-basin/">Permian Basin</a></strong>, where crude production is expanding rapidly. <span id="more-3803"></span>With output surpassing 1.5 million barrels per day, the Permian already represents close to one-fifth of total U.S. crude output. But production success is exacting a toll on the West Texas economic eco-system.</p> <p><a title="Shortage of labor in the Permian Basin" href="https://web.archive.org/web/20211205210449/http://www.oaoa.com/business/article_ad538f62-d313-11e3-bb47-001a4bcf6878.html" target="_blank">Labor supplies</a> are tight. Recruitment of skilled professionals such as geological and petroleum technicians as well as engineers is a formidable challenge. Residential and commercial real estate supplies are squeezed and priced at a premium. Producers attempting to get supplies to market are <a title="congested permian basin oil pipelines" href="https://web.archive.org/web/20211205210449/http://blogs.platts.com/2014/04/21/oil-permian-pipelines/" target="_blank">confronting congested pipelines</a>, outstripping an aggressive scheme to add new takeaway capacity.</p> <p>These constraints are forcing producers to negotiate what has become a critical and delicate <a title="Permian crude oil gathering system" href="https://web.archive.org/web/20211205210449/http://www.ogfj.com/articles/2014/04/building-out-the-permian-crude-oil-gathering-system-part-2.html" target="_blank">balance between supplies and takeaway infrastructure</a>. But the balancing act may be short lived, as cutting edge technologies unlock more petroleum resources in the Permian Basin’s rich geological layering.</p> <p><a title="Oil Rig 3D Video Tour" href="https://web.archive.org/web/20211205210449/https://www.arescotx.com/photos-videos/" target="_blank"><img loading="lazy" class="alignright size-full wp-image-3769" style="border: 0px none; margin: 5px 10px;" src="https://web.archive.org/web/20211205210449im_/https://www.arescotx.com/wp-content/uploads/rig-presentation1.jpg" alt="rig-presentation" width="222" height="222"/></a>In <a title="Permian oil town Carlsbad New Mexico" href="https://web.archive.org/web/20211205210449/http://abcnews.go.com/Technology/wireStory/mexico-oil-country-struggles-cities-boom-23626554" target="_blank">Carlsbad New Mexico</a>, centered on one of the most productive regions on the Permian, getting a hamburger at the local McDonald’s is an ordeal fraught with tribulation. Recent discoveries of rich, promising fields in the Southeastern portions of the state, coupled with advances in extracting technologies, have turned once sleepy hamlets like Carlsbad into bustling boomtowns.</p> <p>And there’s no indication Permian production will tap out anytime soon. Because producing formations in the Permian are vertically stacked atop one another, companies are able to wring oil from varying depths with a single vertical well. Some parts of the Permian have formations spanning 1,300 to 1,800 feet in thickness, akin to having more than a dozen Bakken Shales stacked one-over the other. Thus, current activity focuses on these “stacked” formations where techniques such as vertical drilling, <a title="Horizontal Drilling" href="https://web.archive.org/web/20211205210449/https://www.arescotx.com/tag/horizontal-drilling/">horizontal drilling</a>, and <a title="enhanced oil recovery systems" href="https://web.archive.org/web/20211205210449/http://www.ogfj.com/articles/2014/04/building-out-permian-crude-gathering-systems-part-2.html" target="_blank">enhanced oil recovery (EOR)</a> are being deployed.</p> <p>Some analysts are predicting double digit year-over-year increases in Permian production over the next several years. In fact some experts are saying the <a title="Eagle Ford Shale" href="https://web.archive.org/web/20211205210449/https://www.arescotx.com/tag/eagle-ford-shale/">Eagle Ford Shale</a> and <a title="Bakken Shale" href="https://web.archive.org/web/20211205210449/https://www.arescotx.com/tag/bakken-shale/">Bakken Shale</a> areas will top out long before the <a title="Permian Basin" href="https://web.archive.org/web/20211205210449/https://www.arescotx.com/tag/permian-basin/">Permian Basin</a> loses steam.</p> <p><a title="Oil and Gas Investing" href="https://web.archive.org/web/20211205210449/https://www.arescotx.com/oil-gas-interests-explored-pathways-to-profit/" target="_blank"><img loading="lazy" class="alignleft size-full wp-image-2610" style="border: 0px none; margin: 5px 10px;" src="https://web.archive.org/web/20211205210449im_/https://www.arescotx.com/wp-content/uploads/pathways-to-profit1.jpg" alt="Oil and Gas Investing" width="222" height="137"/></a>Yet these growing pains are exposing a wealth of robust opportunities. <a title="Permian Basin real estate opportunities" href="https://web.archive.org/web/20211205210449/http://www.businesswire.com/news/home/20140421005390/en/TAYO-Oil-Gas-Boom-Creates-Unprecedented-Real#.U3OHOSg4w1J" target="_blank">Taylor Consulting is predicting</a> an unprecedented real estate boom in cities and towns along the Permian. Obviously these production growing pains are fertile ground for midstream companies. But these pains will also be a <a title="Permian Basin helping oilfield services companies" href="https://web.archive.org/web/20211205210449/http://www.forbes.com/sites/greatspeculations/2014/03/17/why-the-shift-to-unconventionals-in-the-permian-will-help-oilfield-services-companies/" target="_blank">boon to oilfield services companies</a> as producers look to maximize mature wells with technologies such as carbon dioxide flooding, and ramp up exploration and production of unconventional hydrocarbons.</p> <p>No matter how you stack it, the <a title="Permian Basin" href="https://web.archive.org/web/20211205210449/https://www.arescotx.com/tag/permian-basin/">Permian Basin</a> is experiencing an unprecedented resource renaissance—one with bankable stamina.</p> <p><span style="color: #ff0000;"><strong>RELATED &gt;&gt;</strong></span> <a href="https://web.archive.org/web/20211205210449/https://www.arescotx.com/staging-the-next-boom-shale-2-0/">Staging the Next Boom: Shale 2.0</a></p> <p><span style="color: #ff0000;"><strong>RELATED &gt;&gt;</strong></span> <a href="https://web.archive.org/web/20211205210449/https://www.arescotx.com/fracking-boom-driving-massive-industrialization-in-louisiana/">Fracking Boom Driving Massive Industrialization in Louisiana</a></p> <p><span style="color: #ff0000;"><strong>RELATED &gt;&gt;</strong></span> <a href="https://web.archive.org/web/20211205210449/https://www.arescotx.com/eagle-ford-shale-boom-may-soon-cross-mexican-border/">Eagle Ford Shale Boom May Soon Cross Mexican Border</a></p> <p><span style="color: #ff0000;"><strong>RELATED &gt;&gt;</strong></span> <a href="https://web.archive.org/web/20211205210449/https://www.arescotx.com/oil-boom-means-big-money-big-needs-in-south-texas/">Oil boom means big money, big needs in south Texas</a></p> <p><span style="color: #ff0000;"><strong>RELATED &gt;&gt;</strong></span> <a href="https://web.archive.org/web/20211205210449/https://www.arescotx.com/permian-rising-booming-energy-production-driving-tx-nm-economies/">Permian Rising ~ Booming Energy Production Driving TX &amp; NM Economies</a></p> <span class="cp-load-after-post"></span><div class="nextpages"></div> <div style="padding-top:30px;"> <ul class="pager"> <!-- for previous --> <li class="nav-previous"><a href="https://web.archive.org/web/20211205210449/https://www.arescotx.com/aresco-lp-purchases-position-in-halcon-wells-in-southeast-texas-brazos-basin/" rel="next">Previous</a></li> <!-- for current --> <li class="nav-bloghome"><a href="https://web.archive.org/web/20211205210449/https://www.arescotx.com/latest-news/"><span class="icon"></span>All Posts</a></li> <!-- for next --> <li class="nav-next"><a href="https://web.archive.org/web/20211205210449/https://www.arescotx.com/mexicos-eagle-ford-gain-to-reap-texas-reward/" rel="prev">Next</a></li> </ul> </div> <ul class="pager"> <li></li> <li></li> </ul> </div><!-- end col --> <div class="col-lg-3 col-md-3 sidebar"> <p class="titles">Recent Posts</p> <ul> <li> <a href="https://web.archive.org/web/20211205210449/https://www.arescotx.com/eight-tax-advantages-available-for-direct-oil-gas-investments/">7 Tax Deductions and Advantages Available for Direct Oil and Gas Investments</a> </li> <li> <a href="https://web.archive.org/web/20211205210449/https://www.arescotx.com/eagle-ford-shale-production-shattering-records-in-texas/">Eagle Ford Shale Production Numbers Luring Investors to the Region</a> </li> <li> <a href="https://web.archive.org/web/20211205210449/https://www.arescotx.com/why-invest-in-north-american-energy-and-why-now/">Why invest in North American energy, and why now?</a> </li> <li> <a href="https://web.archive.org/web/20211205210449/https://www.arescotx.com/texas-tops-oil-and-gas-investments/">Texas Tops Oil and Gas Investments</a> </li> <li> <a href="https://web.archive.org/web/20211205210449/https://www.arescotx.com/vertical-wells-still-a-mainstay-of-oil-production-in-oklahoma/">Vertical Wells Still a Mainstay of Oil Production in Oklahoma</a> </li> </ul> <p class="titles">Categories</p> <ul> <li class="cat-item cat-item-14"><a href="https://web.archive.org/web/20211205210449/https://www.arescotx.com/category/new-mexico-oil-and-gas-investing/" title="New Mexico oil and gas investing news, blogs, and videos by Aresco LP. 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">Texas Oil and Gas Investing</a> </li> <li class="cat-item cat-item-1"><a href="https://web.archive.org/web/20211205210449/https://www.arescotx.com/category/uncategorized/" title="General blog category on Aresco LP's Oil and Gas Current Events blog.">Uncategorized</a> </li> </ul> <style scoped type="text/css">.utcw-b1fq2ep {word-wrap:break-word}.utcw-b1fq2ep span,.utcw-b1fq2ep a{border-width:0px}.utcw-b1fq2ep span:hover,.utcw-b1fq2ep a:hover{border-width:0px}</style><p class="titles">Tag Cloud</p><div class="utcw-b1fq2ep tagcloud"><a class="tag-link-43 utcw-tag utcw-tag-bakken-shale" href="https://web.archive.org/web/20211205210449/https://www.arescotx.com/tag/bakken-shale/" style="font-size:10.512820512821px" title="9 topics">Bakken Shale</a> <a class="tag-link-95 utcw-tag utcw-tag-crude-oil" href="https://web.archive.org/web/20211205210449/https://www.arescotx.com/tag/crude-oil/" style="font-size:30px" title="47 topics">Crude Oil</a> <a class="tag-link-70 utcw-tag utcw-tag-crude-oil-export-ban" href="https://web.archive.org/web/20211205210449/https://www.arescotx.com/tag/crude-oil-export-ban/" style="font-size:10px" title="8 topics">Crude Oil Export Ban</a> <a class="tag-link-105 utcw-tag utcw-tag-crude-oil-exports" href="https://web.archive.org/web/20211205210449/https://www.arescotx.com/tag/crude-oil-exports/" style="font-size:10.512820512821px" title="9 topics">Crude Oil Exports</a> <a class="tag-link-7 utcw-tag utcw-tag-crude-oil-prices" href="https://web.archive.org/web/20211205210449/https://www.arescotx.com/tag/crude-oil-prices/" style="font-size:14.615384615385px" title="17 topics">Crude Oil Prices</a> <a class="tag-link-39 utcw-tag utcw-tag-domestic-oil-production" href="https://web.archive.org/web/20211205210449/https://www.arescotx.com/tag/domestic-oil-production/" style="font-size:15.641025641026px" title="19 topics">Domestic Oil Production</a> <a class="tag-link-101 utcw-tag utcw-tag-donald-j-trump" href="https://web.archive.org/web/20211205210449/https://www.arescotx.com/tag/donald-j-trump/" style="font-size:10px" title="8 topics">Donald J Trump</a> <a class="tag-link-5 utcw-tag utcw-tag-drilling-technology" href="https://web.archive.org/web/20211205210449/https://www.arescotx.com/tag/drilling-technology/" style="font-size:13.589743589744px" title="15 topics">Drilling Technology</a> <a class="tag-link-10 utcw-tag utcw-tag-eagle-ford-shale" href="https://web.archive.org/web/20211205210449/https://www.arescotx.com/tag/eagle-ford-shale/" style="font-size:20.769230769231px" title="29 topics">Eagle Ford Shale</a> <a class="tag-link-33 utcw-tag utcw-tag-eagle-ford-shale-production" href="https://web.archive.org/web/20211205210449/https://www.arescotx.com/tag/eagle-ford-shale-production/" style="font-size:10.512820512821px" title="9 topics">Eagle Ford Shale Production</a> <a class="tag-link-100 utcw-tag utcw-tag-energy-independence" href="https://web.archive.org/web/20211205210449/https://www.arescotx.com/tag/energy-independence/" style="font-size:10.512820512821px" title="9 topics">Energy Independence</a> <a class="tag-link-16 utcw-tag utcw-tag-energy-information-administration-eia" href="https://web.archive.org/web/20211205210449/https://www.arescotx.com/tag/energy-information-administration-eia/" style="font-size:14.102564102564px" title="16 topics">Energy Information Administration (EIA)</a> <a class="tag-link-42 utcw-tag utcw-tag-fracking" href="https://web.archive.org/web/20211205210449/https://www.arescotx.com/tag/fracking/" style="font-size:11.538461538462px" title="11 topics">Fracking</a> <a class="tag-link-34 utcw-tag utcw-tag-horizontal-drilling" href="https://web.archive.org/web/20211205210449/https://www.arescotx.com/tag/horizontal-drilling/" style="font-size:12.051282051282px" title="12 topics">Horizontal Drilling</a> <a class="tag-link-8 utcw-tag utcw-tag-hydraulic-fracturing" href="https://web.archive.org/web/20211205210449/https://www.arescotx.com/tag/hydraulic-fracturing/" style="font-size:17.692307692308px" title="23 topics">Hydraulic Fracturing</a> <a class="tag-link-29 utcw-tag utcw-tag-investing-in-texas-oil" href="https://web.archive.org/web/20211205210449/https://www.arescotx.com/tag/investing-in-texas-oil/" style="font-size:11.025641025641px" title="10 topics">Investing in Texas Oil</a> <a class="tag-link-13 utcw-tag utcw-tag-oil-and-gas-investing" href="https://web.archive.org/web/20211205210449/https://www.arescotx.com/tag/oil-and-gas-investing/" style="font-size:14.615384615385px" title="17 topics">Oil and Gas Investing</a> <a class="tag-link-115 utcw-tag utcw-tag-oil-and-gas-technology" href="https://web.archive.org/web/20211205210449/https://www.arescotx.com/tag/oil-and-gas-technology/" style="font-size:10px" title="8 topics">Oil and Gas Technology</a> <a class="tag-link-84 utcw-tag utcw-tag-oil-market" href="https://web.archive.org/web/20211205210449/https://www.arescotx.com/tag/oil-market/" style="font-size:11.025641025641px" title="10 topics">Oil Market</a> <a class="tag-link-17 utcw-tag utcw-tag-oil-production" href="https://web.archive.org/web/20211205210449/https://www.arescotx.com/tag/oil-production/" style="font-size:18.205128205128px" title="24 topics">Oil Production</a> <a class="tag-link-32 utcw-tag utcw-tag-opec" href="https://web.archive.org/web/20211205210449/https://www.arescotx.com/tag/opec/" style="font-size:15.641025641026px" title="19 topics">OPEC</a> <a class="tag-link-11 utcw-tag utcw-tag-permian-basin" href="https://web.archive.org/web/20211205210449/https://www.arescotx.com/tag/permian-basin/" style="font-size:28.461538461538px" title="44 topics">Permian Basin</a> <a class="tag-link-57 utcw-tag utcw-tag-shale-oil" href="https://web.archive.org/web/20211205210449/https://www.arescotx.com/tag/shale-oil/" style="font-size:10px" title="8 topics">Shale Oil</a> <a 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