November 23, 2019
November 23, 2019
New Mexico Will Break Another Oil Production Record in 2019
New Mexico Will Break Another Oil Production Record in 2019
We still have over one month left in the calendar year and already New Mexico is on pace to break last year’s record for oil production. According to Ryan Flynn, president of the New Mexico Oil & Gas Association, over 300 million barrels are expected to be produced in 2019 alone which “will make three years in a row of record production.” Based on monthly production reports by the New Mexico Oil & Conservation Division, 2019 oil output is up 36% compared with the same period last year. Currently, the state is producing an unprecedented 900,000 barrels per day. Twenty eighteen and 2017 were both record-breaking years themselves. In 2018, over 249 million barrels were produced for the entire year, which outperformed the 173 million barrels in 2017. At the rate things are going, the state should easily surpass 300 million barrels before the end of 2019. As of August 2019 (the latest month which the OCD estimates are available), the state was already at 209 million barrels. To put things into perspective, there were only 153.5 million barrels produced during the same timeframe last year, and 108 million for the same timeframe in 2017. The use of hydraulic fracturing and horizontal drilling have contributed to the state’s steady increase in output. This modern technology has allowed operatives to reach large pools of hydrocarbons that were not accessible before. New Mexico is greatly benefitting from the increase in production. Statewide budgets have generated $1 billion budget surpluses due to an influx of oil and gas revenue. The future continues to look bright for New Mexico. The New Mexico Oil & Gas Association contracted with the global consulting firm ICF to study the sustainability of New Mexico production going forward. From this, a report released by the ICF in September estimates production could increase by another 300% over the next decade, generating $8 billion in annual revenue for the state by 2030. “High production really is the new normal for the foreseeable future in New Mexico,” Flynn said. “The industry has consolidated around the Permian Basin and we believe production will remain at record levels.”
We still have over one month left in the calendar year and already New Mexico is on pace to break last year’s record for oil production. According to Ryan Flynn, president of the New Mexico Oil & Gas Association, over 300 million barrels are expected to be produced in 2019 alone which “will make three years in a row of record production.” Based on monthly production reports by the New Mexico Oil & Conservation Division, 2019 oil output is up 36% compared with the same period last year. Currently, the state is producing an unprecedented 900,000 barrels per day. Twenty eighteen and 2017 were both record-breaking years themselves. In 2018, over 249 million barrels were produced for the entire year, which outperformed the 173 million barrels in 2017. At the rate things are going, the state should easily surpass 300 million barrels before the end of 2019. As of August 2019 (the latest month which the OCD estimates are available), the state was already at 209 million barrels. To put things into perspective, there were only 153.5 million barrels produced during the same timeframe last year, and 108 million for the same timeframe in 2017. The use of hydraulic fracturing and horizontal drilling have contributed to the state’s steady increase in output. This modern technology has allowed operatives to reach large pools of hydrocarbons that were not accessible before. New Mexico is greatly benefitting from the increase in production. Statewide budgets have generated $1 billion budget surpluses due to an influx of oil and gas revenue. The future continues to look bright for New Mexico. The New Mexico Oil & Gas Association contracted with the global consulting firm ICF to study the sustainability of New Mexico production going forward. From this, a report released by the ICF in September estimates production could increase by another 300% over the next decade, generating $8 billion in annual revenue for the state by 2030. “High production really is the new normal for the foreseeable future in New Mexico,” Flynn said. “The industry has consolidated around the Permian Basin and we believe production will remain at record levels.”