With vast supplies of natural gas and oil being produced in shale regions across America, the United States is now the world’s largest producer of energy coming from oil and natural gas. Besides sounding impressive, the bigger implication is the contribution it provides to America’s energy security. Texas is aiding the cause—and has been for more than a hundred years—thanks in no small part to bountiful reservoirs inside a sedimentary formation known as the Permian Basin.

Here are five key things to know about one of the world’s most exciting oil and natural gas plays.

First oil
Wildcatters were producing oil in the Permian Basin long before the “shale gale” blew in. The basin’s first commercial well, T&P Abrams Number One, came online in 1923 and wasn’t capped until 1990. The Yates Field, where oil was first discovered in 1926, still operates today, producing more than 7.4 million barrels annually.

Proven reserves
Growing shale oil production has turned the Permian Basin into one of the country’s most promising oil regions. According to the most recent Energy Information Agency’s assessment, the Permian Basin holds 722 million barrels of proven reserves, more than twice the number (387 million) registered in the EIA’s 2013 U.S. reserves estimate.

Critical plays
Driving much of the Permian Basin’s new production are the Wolfcamp, Spraberry and Bone Spring formations. Together, they generate nearly half of the Permian Basin’s output.

Drilling innovations
Drilling innovations are at the heart of the Permian renaissance. For much of its history, oil was pumped out of easy-to-access reservoirs through standard vertical wells. Oil production from shale or tight rock formations wasn’t part of the equation until the horizontal drilling and hydraulic fracturing technology used to produce shale gas was customized to extract oil locked inside the Permian Basin.

Annual production
This brings us to the Permian Basin’s annual production. In 2008, daily output averaged a little more than 710,000 barrels. However, in 2016, production in Texas more than doubled from 2008 levels, averaging over 1.5 million barrels per day.* While the fall in oil and natural gas prices could moderate production growth, over the long term the Permian Basin is expected to continue to play an important role in helping meet domestic demand with reliable and affordable energy, while also helping decrease dependence on imported sources of energy.

*Data updated November 2017








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