The Texas Delaware Basin: Parsley Energy and Other Activity
Thursday June 9, 2016
Late last month Parsley Energy acquired approximately 30,000 acres in Pecos and Reeves Counties, Texas.
This substantial transaction came on the heels of an April acquisition of 40,000 acres in the same region. Because Reeves County came up in my look at Anadarko operations a few weeks back, I thought it would be a good time to take a look at activity in the Texas portion of the Delaware Basin, and Reeves County in particular.
Parsley Energy’s New Core
First let’s take a look at Parsley. Historically the company has been focused on activity in the heart of the Midland Basin, in particular the Wolfcamp formations. According to their May 2016 investor presentation, their 1Q16 production was 29.1 MBoe/d with a 65% oil mix, and their Midland Wolfcamp A/B wells are generating very favorable results vs. their peers in the area through both increased production and lower completion costs per stimulated foot.
So given their Wolfcamp expertise, and strong Midland Basin results, the strategic movement into the Delaware Basin does make sense – it’s just a few counties over, and initial results in their acreage appear to be promising. Here is their new acreage position:
Image Source: Company May 2016 Presentation
They have certainly been executing very well in the market – in fact CEO Bryan Sheffield is a newly minted billionaire!
The Texas Portion of the Delaware Basin
Let’s examine these Wolfcamp Full Sections of...