Permian’s Limited Natural Gas Takeaway, Fewer DUCs Signal Lower Oil Output

The number of wells completed each month in the Lower 48 has outpaced the number drilled since July 2020, which, combined with limited natural gas pipeline capacity from the Permian Basin, may reduce oil production growth, the Energy Information Administration (EIA) said.

The decline in drilled but uncompleted wells, aka DUCs, was noted in EIA’s Drilling Productivity Report earlier this month.

“Although the number of active oil-directed rigs, which drill new oil wells, was increasing earlier this year, the rig count has remained relatively flat since July,” said EIA’s principal contributors Jeffrey Barron, Matthew French and Jozef Lieskovsky.

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