Exxon Mobil plans to increase its oil production in the Permian Basin to reach 600,000 barrels a day by 2025. The energy giant also plans to spend over $2 billion on transportation and terminal upgrades in west Texas, the Houston Chronicle reported last week.
Over the next five years, Exxon intends to invest $50 billion in the U.S., due in part to financial benefits from the new U.S. tax code.
Exxon doubled its footage drilled per day on horizontal wells in the Permian Basin after acquiring more Permian acreage in a 2017 land purchase from Fort Worth’s well-known Bass family. The move reduced the company’s drilling costs per foot by approximately 70 percent, with development and production costs at less than $15 per barrel, the company said.
Sara Ortwein, president of Exxon Mobil’s onshore shale subsidiary, XTO Energy, said, “Our geographic and competitive advantages in the Permian position the company for strong growth and long-term value creation,” The Chronicle reported.
Ortwein continued, “With this production growth, we are well positioned to maximize value as increased supply moves from the Permian to our Gulf Coast refineries and chemical facilities where higher-demand, higher-value, products will be manufactured.”
Midland, the geographic center of the Permian Basin, is perfectly poised to experience an economic benefit from these developments.
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