ExxonMobil to Triple Permian Production by 2025
The horizontal rig count in the Permian is expected to increase a further 65% over the next several years.
ExxonMobil recently announced that it plans to triple total daily production to more than 600,000 oil-equivalent barrels by 2025 from its operations in the Permian Basin in West Texas and New Mexico. Tight oil production from the Delaware and Midland basins will increase five-fold in the same period.
Through capital-efficient production growth, the increased volumes will be driven by reduced drilling costs, technology improvements and expanded acreage. To help achieve this growth, the horizontal rig count in the Permian is expected to increase a further 65% over the next several years. ExxonMobil has doubled its footage drilled per day on horizontal wells in the Permian since early 2014 and reduced per-foot drilling costs by about 70%.
“Our geographic and competitive advantages in the Permian position the company for strong growth and long-term value creation,” said Sara Ortwein, president of ExxonMobil’s XTO Energy subsidiary. “We can deliver profitable production at a range of prices, and we have logistics and technology advantages over our competitors.”
Through its $6 billion Bass companies acquisition in 2017, ExxonMobil added an estimated resource of 3.4 billion barrels of oil equivalent, with upside potential in multiple additional prospective horizons. A large majority of the development drill wells from the purchase are projected to have attractive returns at oil prices below current levels.
“With this production growth, we are well-positioned to maximize value as increased supply moves from the Permian to our Gulf Coast refineries and chemical facilities where higher-demand, higher-value products will be manufactured,” Ortwein said.
As part of its Permian-focused infrastructure, ExxonMobil recently acquired a crude oil terminal in Wink, Texas, that is strategically positioned to handle Permian crude oil and condensate from Delaware basin sources near the Texas-New Mexico border for transport to Gulf Coast refineries and marine export terminals. The company plans to expand the Wink terminal and add key infrastructure upgrades that will efficiently move ExxonMobil and third-party production from the Delaware, Central and Midland basins in the Permian to ExxonMobil’s operations and other market destinations in the Gulf Coast region. Those investments, expected to exceed $2 billion, will reportedly support short-term construction jobs and long-term positions.
For more information, visit www.exxonmobil.com.