Permian Basin

In yet another move that reaffirms its commitment to oil projects in the Midcontinent and the liquids-rich portion of the Marcellus Shale in southwest Pennsylvania, Range Resources Corp.is putting up for sale 70,000 net acres in West Texas and essentially exiting the Permian Basin.

Midstream players have allocated a lot of capital to boost crude takeaway and/or natural gas processing capacity in the renewed Permian Basin, and if production continues to accelerate, several billion more could be directed to the region to meet the growing needs of producers, according to an analysis by Raymond James & Associates Inc.

Counties in the Eagle Ford Shale region of South Texas were four of the state’s top five oil-producing counties during September, while North Texas counties were four of the top five natural gas producers, according to the Railroad Commission of Texas (RRC).

The venerable Permian Basin, where production peaked in the 1970s, has come to life bigger and stronger, and is proving to still be the rock of choice for a lot of exploration and production (E&P) companies and oilfield service operators.

Close to 100 additional rigs will be moved to the U.S. onshore through 2014, with about half directed to the Permian Basin, according to an analysis by Tudor, Pickering, Holt & Co. (TPH).

Dallas independent Pioneer Natural Resources Co. said its fourth well in the Permian Basin formation has tested at a 24-hour initial production (IP) rate of 3,605 boe/d, the highest for any interval in the Spraberry/Wolfcamp to date.

Natural gas production in the Marcellus Shale continues to surge higher, with 12.9 Bcf/d expected to come out of the prolific play in December, a 3.3% increase from 12.5 Bcf/d in November, according to EIA’s second Drilling Productivity Report (DPR) for key tight oil and shale gas regions.

Texans have voted overwhelmingly for a constitutional amendment to allocate $2 billion from the state’s “rainy day” fund to programs intended to secure water supplies in the frequently drought-stricken state. The measure had the support of the oil and gas industry, whose use of water for hydraulic fracturing is often scrutinized.

After stumbling through some rough quarters as it reworked the portfolio toward North America’s unconventionals, Devon Energy Corp. this week reported improved profitability in the third quarter, and management said the gains offer opportunities that could provide the next leg of high margin growth.