“It’s going to start to roll over, and when that happens, that’s when the US is at risk for losing our energy independence,” Chief Executive Officer Vicki Hollub said in a presentation at Hart Energy’s Executive Oil Conference in Midland, Texas, on Thursday. “That could come in the next five years that we start to see that plateauing happen.”
The US is pumping more than 13 million barrels a day, exceeding every other nation and up almost 45% in just a decade. The global oil market is closely watching to see if American explorers can drill enough new wells to offset the natural decline in aging shale discoveries.
Holllub said President-elect Donald Trump understands the business case for using carbon dioxide to scrape more crude from the bottom of oilfields, a technique known as enhanced oil recovery that Occidental has employed for years.
“He understands that if you lose all of your energy independence, geopolitically we would be weaker in that kind of scenario than we are today,” Hollub said. “What he wants is he wants us to get the most out of the reservoirs that we have here in the US.”
Permian crude output “will peak at slightly above 7 million barrels a day at the end of this decade,” said Pete Bowden, global head of industrial, energy and infrastructure investment banking at Jefferies Financial Group Inc. “But thereafter will decline more gradually than most experts expect.”
There’s anywhere from 10 to 25 years of drilling inventory left in the Permian’s Delaware sub-basin, according to a presentation from ConocoPhillips, citing data from industry consultant Enverus. In the Midland sub-basin that has been producing oil for more than a century, the drilling inventory is seen in the range of eight to 15 years.
