Permits for new oil and gas wells rose 25% month/month in July, with “significant” growth in the Permian Basin, but overall activity was down by two-thirds from a year ago, according to Evercore ISI.
The analyst team led by James West each month compiles federal and state permitting data, which provides a window into what future U.S. oil and gas activity may look like.
The July numbers indicated that “activity is back on the menu,” but the Lower 48 is “very much still on a diet,” as permitting was off 66% from July 2019, West said.
The most active area was the Permian, where growth was driven by mid-cap exploration and production companies, which requested 52% more permits than in June.
“Operator permitting activity increased to 1,545 wells in July,” up 25% month/month. Most of the applications were submitted in the Permian, up 19%, while other plays climbed 18%.
The Railroad Commission of Texas (RRC) reported 1,354 oil permits were issued in July, 24% higher than in June. The commission also approved 395 wells, about 37% higher month/month, with most of the wells slated for the West Texas portion of the Permian. (by CAROLYN DAVIS, Natural Gas Intelligence)