What to Know About the Oil and Gas Industry in Texas and New Mexico
Nearly
half of the oil and gas rigs operating in the United States are pumping in the
Lone Star State, according to the latest data from the Energy Information
Agency.
But
it's far from alone.
New
Mexico is no slouch, either, thanks largely to the Permian Basin, the nation's
most active energy play.
Budget
officials in the Land of Enchantment say the state is on pace to collect $275
million more in revenues, a trend they credit to strong oil production in
southeastern New Mexico.
"It's
our bread and butter," said Missi Currier, president/CEO for the Economic
Development Corp. of Lea County, in Hobbs, New Mexico.
Currier
said Hobbs, Roswell and other New Mexico communities within reach of the
Permian Basin have experienced population shifts that are tied to the oil and
gas industry. She held out hope continued energy growth would eventually lead
to increased spending for schools, road improvements and other quality-of-life
ventures.
"It
is our economic engine ... but we're hopeful it can also open the door to
diversification," Currier said.
Here's
what you need to know:
What
is the Permian Basin?
Size
— Spans roughly 250 miles wide, 300 miles long; includes the Texas counties of
Andrews, Borden, Crane, Dawson, Ector, Gaines, Glasscock, Howard, Loving,
Martin, Midland, Pecos, Reeves, Terrell, Upton, Ward, and Winkler.
History — The area was once covered by the Permian Sea, hence its name.
Strong
production — It's credited with some of the nation's greatest oil production
gains in recent years, including those during the recession. Oil production in
the Permian Basin has increased fourfold since August 2011 to more than 4
million barrels daily this year.
What
is Eagle Ford?
Eleven
years and counting — A company once known as Petrohawk Energy Corp., is
credited with drilling the first Eagle Ford wells in 2008, in LaSalle County,
Texas. The company’s discovery well flowed at a rate of 7.6 million cubic feet
of gas per day.
International
ties — It extends across Texas from the Mexican border into East Texas, and is
roughly 50 miles wide and 400 miles long. It encompasses more than two dozen
Texas counties, including Webb County, where Laredo is located. Mexico has
changed its energy policy in recent years, opening the door to additional
economic growth on its side of the border.
How
big is big — Some experts estimate it contains about 3 billion in oil reserves
and 50.2 trillion cubic feet of gas.
Who's
producing what?
Energy
plays are scattered throughout the country, but the most prolific and
productive are in Texas and New Mexico.
Rig
count
New
Mexico
Number
of rigs (as of Aug. 16): 111
Number
of rigs (August 2018): 104
Texas
Number
of rigs (as of Aug. 16): 450
Number
of rigs (August 2018): 525
Rest
of U.S.
Number
of rigs (as of Aug. 16): 374
Number
of rigs (August 2018): 426
Regional
energy play rig counts
Barnett
Number
of rigs (as of Aug. 16): 1
Number
of rigs (August 2018): 2
Eagle
Ford
Number
of rigs (as of Aug. 16): 67
Number
of rigs (August 2018): 79
Haynesville
Number
of rigs (as of Aug. 16): 50
Number
of rigs (August 2018): 48
Permian
Number
of rigs (as of Aug. 16): 441
Number
of rigs (August 2018): 486
Delivering
crude oil from Permian Basin to Texas Gulf Coast
Getting
oil from one place to another factors heavily into some energy companies'
profit margins.
Consider
what San Antonio-based EPIC Midstream Holdings LP has been doing.
The
company plans is in the final stages of running a pipeline system from the
Permian Basin to the Texas Gulf Coast, where its products can be more easily
shipped.
EPIC
announced Monday its pipeline, which extends from Orla to the Port of Corpus
Christ, had begun delivering crude.
The
South Texas port is also working to dredge and widen its ship channel to
accommodate larger Suezmax tankers that carry up to 1 million barrels in a
single haul.
A barrel of West Texas Intermediate crude on Tuesday traded for $55.30, down about $6 from a year ago and from nearly $100 in 2014. Brent sold for $60.25.