Permian Basin Oil Production (by G O'Graffer)
Amidst signs of life with renewed shale production in the Permian Basin of West Texas, geologists this week revealed a timely discovery.
While shale oil plays have suffered along with depressed prices for crude, the assessment from the U.S. Geological Survey found thatthe Wolfcamp area within the Permian could be the lasgest ever estimated in the U.S.
In a pointed revelation, geologists told a conference for shale producers, that the Wolfcamp could hold as much as 20 billion barrels of oil and about 16 trillion cubic feet of natural gas trapped in three layers in former oil wells, thought to be depleted.
The announcement means that the Bakken oil formation of North Dakota and home of the shale oil revolution would now be dwarfed by the Wolfcamp. by a factor of three to one. Indeed, according tothe USGS, the discovery represents the largest assessment of continuous oil in its history. That billions of barrels lie untapped in an area that has already produced billions in the past, is nothing less than remarkable. Its also likely to lead to more confidence in Texas oil at a time of uncertainty.
With this potential in mind, the future of Texas oil appears to have taken a turn for the better. In the past year, Texas has begun to re-emerge as a major crude producer having produced over a billion barrels despite economic hardship in the oilpatch. With more oil rigs in the Permian Basin than all other plays combined in the U.S., the new Wolfcamp are find will almost certainly sustain oil production momentum.
Significantly, with pipeline entaglements over the Dakota Access Pipeline, and growing fear of earthquakes caused by fracking in Oklahoma, the Texas re-discovery is timely and well positioned. Add to this exciting prospect changes in the tempo in Washington, and the old addage "timing is everything" seems to apply to an announcement that has revived the hopes and dreams of oil producers and prospects for jobs and better times ahead.
Wolfcamp may soon be part of our everyday vernacular !