The Midland, Texas, Folks Are Preparing For Another Boom

For newbies: active drilling will be necessary through 2030 to drill 48,000 wells to exhaust the Bakken (with today's technology and today's estimates). Production from the Bakken will continue through 2100.

The Permian is estimated to be several times bigger than the Bakken (although some will disagree with the "several times").

The Permian is just beginning. Production is enormous.

The oil and gas industry is well known to go through boom and bust cycles.

North Dakota reports a new record yesterday: > 900,000 bbls of crude oil being produced daily.

Read the following story, in that context, and note the byline (Midland, Texas), being reported by The Dickinson Press:

MIDLAND, Texas — In a faded West Texas town dotted with vacant buildings and potholed streets is a sparkling storefront window and a curious display: rows of diamond-studded Rolex watches, awaiting buyers whose pockets are packed with oil money.

The surge in oil drilling has drawn money and men like a magnet to run-down communities that haven’t seen a boom since the 1980s.

But leaders and residents here are increasingly mindful that the runaway riches tapped by hydraulic fracturing will eventually run out. And they are determined to live by a fondly remembered bumper sticker from the last bust: Please, God, give me another oil boom and I promise not to blow it. So some towns are taking steps to ensure they land softly rather than crash into economic ruin.

The Permian (Midland, Texas) is getting ready for another boom.

The US is now #1 in the world -- repeat, #1 in the world -- for producing oil and gas.

I believe the US is now out-producing Saudi Arabia, and will soon out-produce Russia in oil, making the US the #1 crude oil producer in the world.

With that in mind, recall our first nominee for the 2013 Geico Rock Award. The graph at this link might help put things into perspective.