Diogenes
Nemo me impune lacessit
As of early 2025, there is no clear indication that oil companies are uniformly shutting down operations in the Permian Basin in Texas. Instead, the situation is nuanced:
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- Production Growth: Contrary to shutdowns, projections for 2025 suggest an increase in both oil and natural gas production in the Permian Basin. The Texas Oil and Gas Association, with data from the U.S. Energy Information Administration, forecasts that crude oil production will reach 6.6 million barrels per day, and natural gas production will average 25.8 billion cubic feet per day. This indicates ongoing and possibly expanding operations rather than closures.
- Rig Counts and Operations: While there has been a decline in rig counts, this hasn't necessarily translated into reduced production. Efficiency gains and technological advancements, such as longer lateral lengths and optimized well spacing, have allowed for increased production with fewer rigs. The Permian Basins' oil production is expected to grow by 300,000 barrels per day in 2025 despite a lower rig count compared to previous years.
- Historical Context: The Permian Basin has faced operational adjustments over the years due to various factors like the global oil market, pandemics, and policy changes. There was a significant reduction in operations during events like the 2020 global health crisis due to decreased demand, but this was more of a temporary adjustment rather than a permanent shutdown.
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