All Things Energy - Volume 3
The Permian Basin is one of Texas’ oldest oil fields, pumping oil since the 1920’s. But, nearly three decades ago, Texas Monthly magazine ran a post mortem on the Texas oil industry with the headline reading “So long, it was fun while it lasted” with a figure of a cowboy riding off into the sunset.
Boom and bust in the Permian Basin in West Texas! Hi, I’m Tamra Freedman with Breitling Energy, and welcome to this segment of “All Things Energy”. Back then, few would’ve questioned such a dire assessment, as the mother of all busts was destroying the West Texas banking industry. It made oil barons into car salesmen, and turned parts of Midland and Odessa into junkyards of rusting equipment.
The Crash of 1982 was triggered by an oil glut that resulted in a relentless price decline. A long depression chased most of the industry majors out of the Permian Basin and an entire generation of oil field workers into other livelihoods.
Breitling Energy’s CEO Chris Faulkner referenced the end of 50 years worth of oil development work in the Permian, when he stated, “In 1983, they thought the oil industry in Texas was done.”
But, as the saying goes, the obituary proved a trifle premature. And, it’s an exciting time to be back drilling in the Permian Basin in West Texas!
Today’s strong demand for oil coupled with refined hydraulic fracturing and horizontal drilling techniques has turned a modest revival into a full-fledged boom.
The play extends across hundreds of square miles of West Texas and into New Mexico, tapping long untouchable, deep reserves. The Baker Hughes rig count for Texas is the best indicator of this new boom. It recently
reached 442, after bottoming out in 1999 at 51. And, there are now more than 155,000 producing wells in the Permian Basin, generating revenue and requiring service for years to come.
The price of oil is hovering around $100 a barrel. With fundamental changes in how oil is being extracted today, it makes some doubt that a drop to $60 or $70 a barrel will kill the boom.
Breitling Energy is excited to announce it controls a 3640 acre lease hold in Sterling County Texas in the heart of the Permian Basin. We plan to drill 50 new Wolfcamp A wells right in the heart of the play.
That about wraps up this segment of “All Things Energy”. Thanks for joining us.