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As land acquisition opportunities dry up in the Permian Basin, the land rush may be replaced by a wave of consolidations that will likely force small and mid-sized producers out of the region, according to analysts. Raymond James analyst John Freeman expects the number of Permian producers to drop by 50% in the next five years as big players such as Chevron, Concho Resources and Pioneer Natural Resources could seek to expand their Permian positions by acquiring smaller rivals so they can drill more and longer laterals, increase productivity and become more efficient

The active number of drilling rigs continues to grow thanks to increasing activity in Texas and the Gulf of Mexico. The overall rig count grew by five - up to 1,008 - courtesy of four rigs added to the Gulf and three in Texas. The loss of two rigs drilling for natural gas kept the rig count from growing higher. As oil prices have risen for much of the last year or so, the rig count has steadily climbed, finally rising above 1,000 rigs a week ago for first time since April 2015. Oil drilling currently accounts for 815 rigs of the total.

U.S. natural gas production reached record levels last year, according to the U.S. Department of Energy, an increase that substantially boosted exports even as Texas, the largest gas-producing state, lost some of its momentum. Gross withdrawals reached 90.9 billion cubic feet per day in 2017, the agency's highest volume on record. Marketed natural gas production, which does not include gas vented, flared, used for re-pressuring or removed during processing, also reached record levels. Louisiana's gross withdrawals increased from 4.8 billion cubic feet per day to to 5.8 billion cubic feet per day, marking the largest annual gain of any state. And the Appalachian region, which includes the Marcellus and Utica shale fields in Ohio, West Virginia and Pennsylvania, also saw substantial volume growth.

Both Texas and the nation are producing more oil than nearly ever, but they're doing so with far fewer workers and drilling rigs. Texas is producing more oil now than at any point in 2014 when oil was last priced above $100 a barrel, and the industry is doing so with more than 25 percent fewer people and almost half the rigs, according to the Texas Petro Index calculated by economist Karr Ingham. Today's rigs are more automated and each of them are able to drill more wells from single locations, as well as produce more oil per well by drilling longer horizontal laterals and using hydraulic fracturing, called fracking, to unlock the petroleum from shale rocks. "The implications are striking: record crude oil and natural gas production at significantly lower prices, rig counts, and number of industry workers," Ingham ...

US shale player Concho Resources has agreed to acquire rival RSP Permian for $8 billion in a move that would expand Concho's Permian Basin foothold by nearly 100,000 acres to a total of 640,000 net acres. "This combination allows us to consolidate premier assets that seamlessly fold into our drilling program, enhance our scale advantage and reinforce our leadership position in the Permian Basin," said Concho Chairman and CEO Tim Leach.

Mergers and acquisitions activity in the US shale patch, particularly the Permian Basin, could surge this year as longer laterals, well spacing and the need for shared infrastructure are expected to drive acreage consolidations. Among the potential takeover targets are Lilis Energy, Abraxas Petroleum and Jagged Peak Energy, analysts say.

Surging drilling activity in the Permian Basin has pushed electricity demand in West Texas to record highs, creating challenges for grid reliability and causing a slowdown in the development of new energy projects such as sand mines due to inadequate transmission. Oncor, a utility serving the Permian Basin, is seeking approval to speed up two transmission projects that would cost about $223.6 million and should help oil and natural gas companies slash costs and boost production.

U.S. crude production rose by 6,000 barrels per day (bpd) in January to 9.964 million barrels per day, the Energy Information Administration said in a monthly report on Friday. The agency revised the December report up by 9,000 barrels to 9.958 million bpd. The gains were driven by a rise in offshore production, which rose 5 percent to 1.62 million bpd from 1.55 million bpd. Production decreased modestly in the major oil producing states of Texas and Alaska, while North Dakota’s production rose slightly to 1.16 million bpd a day, EIA said. U.S. natural gas production in the lower 48 states dipped by 1.4 percent to 86 billion cubic feet per day (bcfd) in January, though that still represented a 9.9 percent increase from a year ago, according to EIA’s monthly production report. Production fell by 2.8 percent in Texas, ...