The low operating cost stems from the region's extensive pipeline infrastructure, plentiful labor and supplies, and relatively warm winters that makes year-round work possible.
According to estimates, the average breakeven prices in most of the Permian well locations is below $50 per barrel – the lowest in the U.S. Permian’s attractive economics means that producers can make money and sustain growth there at the current, $60-a-barrel price. Moreover, there are certain parts of the shale play whose well-returns are the best in the U.S. Permian: A Shale Basin with Superior EconomicsĪ sedimentary basin lying underneath the western part of Texas and the south-eastern part of New Mexico, the Permian Basin Shale covers roughly 75,000 square miles, almost half the size of California.Įxperts say that it’s cheaper to drill and complete oil wells in the Permian Basin, as compared to most other major fields. Crucially, volumes from this low-cost, premier unconventional play will continue to increase and break new record for many years to come, reflecting its status as the dominant domestic growth area for onshore oil production.
#PURE PERMIAN PLAY RODSTAR DRIVER#
While the blistering pace of drilling and output growth have slowed down of late under investor demand to focus on enhancing returns, the region is by far the primary driver of production growth in the U.S. Institutional Distribution Intelligenceįor several years now, the Permian basin has been considered the most significant shale field in the United States.Non-Traditional Exchanges & New Markets.
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