Permian: Midland & Crockett are Top Counties for Drilling Permits
The week of July 17th drilling permit activity was down -34%, with 65 permits issued. The top counties were Midland and Crockett. Both counties had 0 permits issued the week prior. Rig activity in the Permian showed positive signs, with rigs increasing +3 this week.
The chart below shows the decline in activity this year compared to the same week at this time last year, which had 235 permits during the week.
Core Permian Counties
The top 5 permitting counties from last week (2015-07-10), which include Reeves, Lea, Andrews, Ector, and Upton Counties, decreased activity by almost -75% compared to this week. In the past week, Ector County went from 10 permits to 0 permits, while Reeves went from 11 permits to 5 permits.
Midland and Crockett Counties took the top spots across the Permian during the week of 2015-07-17, with 9 permits and 7 permits, respectively. In Midland, all permits issued were for drilling only, and in Crockett, there were 5 issued to drill and 2 for recompletion. 4 counties, Loving, Reeves, Glasscock, and Howard, had 5 permits each. The operators permitting in Midland County included Pioneer Natural Resources, Diamondback, Apache, and Bold Operating, In Crockett County, EP Energy and Anadarko made up the total.
Active Operators in the Week of 2015-07-17
- Apache with 7 permits, up from the previous week’s 5
- Pioneer Natural Resources with 5 permits, up from the prior week’s 3
- EP Energy with 5 permits, up from 0 the week before
- Diamondback with 4 permits, up from 0 the week before
- Anadarko with 4 permits, up from 2 the week before
Apache Decreases Completion Costs by ~33%
Apache expects to spend 60% of its budget this year in the Permian, running 8-12 rigs, a significant reduction from last year’s 40-rig average in the area. They will focus their operations in Midland, Upton, Reagan, and Glasscock Counties. They have seen a 20% decrease in well costs over 2014 in the Southern Midland Basin. In Barnhart, they have seen cost reductions with proppant, hydraulic horsepower, wireline, water transfer, and chemical prices, showing a ~33% decrease form Q4’14 average completion costs.