Drillers make big investment in increased production
Oil and gas companies are loosening their purse strings and preparing to pump more oil and gas.Around 80 percent of the investment will be in US fields. If President Trump's tax plan is enacted their investments could increase another $10 to $15 billion. That would give the US a chance to become energy self-sufficient for the first time in decades. It would also bring a lot people back into the workforce.
Producers expect to spend $25 billion more this year on capital projects than they did last, an increase of 11 percent over 2016, according to the energy research firm Wood Mackenzie. And they hope to pump 1 million more barrels of oil and gas per day.
WoodMac analyzed figures from the 119 oil and gas firms that have already announced their capital budgets. Ninety-nine expect to spend more this year.
Those with holdings in the lower 48 U.S. states — and particularly those in West Texas’ popular Permian Basin — are “setting ambitious growth targets,” WoodMac said. Companies focused on the U.S. will spend about $15 billion or a whopping 60 percent more this year.
WoodMac highlighted companies like shale-oil specialists Pioneer Natural Resources, based in Irving, and Houston-based EOG Resources as those leading the spending increase.
Many companies will also begin pumping more oil and gas. Ninety-eight have announced production expectations for the year, WoodMac said, and think they’ll produce 1 million barrels more of oil equivalent per day, an increase of about 5 percent over last year.