What's the big picture at the 2021 DUG Permian Basin & Eagle Ford Conference?
Lower 48 oil production has rebounded to nearly that of early 2019. And the Permian Basin, in particular, has reached nearly that of first-quarter 2020. It’s tracking to deliver in 2021 its best months of oil volume ever.
And producers are delivering it from cashflow reinvestment rather than new-capital raises. And this is while many are positioning to also begin delivering dividends to shareholders.
How so? The more than 200 rigs drilling across the basin are boring into the core of the hot spots, at lower service costs and at ever-advancing best-practices techniques. Spacing is more wells than a decade ago but fewer than a few years ago for a lower average cost per barrel.
And the associated gas is being monetized now—for dollars and not just cents and as income and not an expense. The Wahalajara pipe now reaches Guadalajara, creating nearly 1 Bcf/d of new takeaway capacity. Spot at Waha was $2.11 in early April. Not -$2.11.
And some producers are accessing incredible refinancing terms—some at less than 1% as the federal funds rate is virtually zero. Some refis by sub-investment-grade-rated operators look like what a normal-grade interest rate. “High yield” refinancings are on sale.
A new tool—the sustainability-linked bond—has been introduced to the market by an oilfield water handler. And it’s bound to become a tool across industry. Operators who’ve been overcoming ESG hurdles for years—and even those who’ve just begun—have new capital-markets tools to gain recognition these days.
And what’s the best performing sector in the S&P so far in 2021? It’s oil and gas—a first time in years.
Meanwhile, what is the Biden Administration’s ultimate plan for federal lands? And for hydrocarbons?
And will Permian operators continue to hold the reins and still to operating within cash flow?
There’s a bounty of oil and gas in the Permian Basin to be tapped. And the basin’s operators and oilfield services leaders are a bounty themselves of ever-fascinating achievements.
We’ll hear from the Permian’s top producers and from investors, financiers and OFS experts on what’s driving this incredible basin and what more is still to be done.
Check out our agenda and speakers from 2020 for an idea of what to expect.