CEOs weigh in on Permian potential

Discussions at the CERAweek conference in Houston centred on West Texas’ red-hot Permian basin on Tuesday, with chief executives weighing in on the basin’s potential.

According to Occidental Petroleum CEO Vicki Hollub, Permian production could double. “I believe the Permian [output] could certainly grow to be 4 million or 5 million per day, I just think it’s going to depend on oil prices,” she said. Occidental has a Permian footprint of close to 239 square kilometres.

Super-major Chevron has USD 2 billion earmarked for Permian investment, Chief Executive John Watson said, adding that the company was going to increase the number of rigs deployed across the basin to some 20 by year-end 2018, with plans to add another 10 beyond 2018.

Watson said Chevron’s Permian production levels are expected to reach between 325,000 boepd and 450,000 boepd by 2020. He also noted that output could exceed 700,000 boepd “within a decade.”

A smaller shale producer, Shell nonetheless aims to ramp up production by 140,000 boepd between now and 2020, Greg Guidry, head of the company’s unconventionals unit, was quoted as saying.

By increasing output in the Permian, upping production from Canada’s Duvernay region and potentially adding capacity from Argentina’s Vaca Muerta formation, Shell hopes to hit shale production of some 500,000 boepd in the Americas past 2020.