Permian Newsletter, February 2001
Executive Summary
Total production during the second quarter of 2000 from the Permian Basin was 4,822
MMcf/d, which was an decrease of 53 MMcf/d from the first quarter 2000. Production during
the second quarter of 2000 was also 73 MMcf/d below the 1999 annual average, which was
4,895 MMcf/d. Production from this basin continues to exhibit a flat to slow decline that
has been underway in the Permian Basin since 1993. It would appear that the decline in
drilling that started in 1998 accelerated the decline rate from this basin. Since 1993,
production is down almost 575 MMcf/d or about 10% during the six and a half-year period.
During 1998, this basin contributed roughly 10% of the total national gas produced.
Background
The Permian Basin occupies approximately 70-80 thousand square miles and includes 51
counties in west Texas and four counties in southeastern New Mexico. The basin is bounded
structurally on the east by the Bend arch, on the north by the Amarillo-Ouachita uplift,
on the west by the Sacramento Mountains and on the south by the Marathon thrust belt.
Sedimentary rocks within the basin are as much as 30,000 feet thick in the deepest areas.
Nearly all the rocks are of Paleozoic era within a thin veneer of Mesozoic strata at the
surface. Carbonates, both limestone and dolomite, are the dominant lithology. The basin
currently produces just over 5 Bcf/d, with 30% of the volume from the New Mexico side and
70% from the Texas side. The Southeast New Mexico area is comprised of almost 14,000 oil
wells and 4,400 gas wells and is the second largest contributor to volumes in the Permian
Basin. Although 76% of the producing wells in this area are oil wells, only about 38% of
the gas production comes from these wells. Four counties contribute to the gas production
from this area. Eddy is the largest gas-producing county in Southeast New Mexico producing
54% of the region's total volumes. Lea is the next largest county contributing 42% of the
region's production. The other two counties, Chaves and Roosevelt together only |
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