The Permian Basin of Texas and New Mexico has emerged as the new poster boy of the U.S. shale oil revolution.
Land prices in the shale oil rich Permian have skyrocketed, and drilling activity for has tripled since last year. Furthermore, production there is poised to soar despite cheap oil prices.
Some are even predicting this hotbed of shale activity could eventually surpass the colossal Ghawar field in Saudi Arabia. Ghawar has been the world’s biggest oilfield.
The Permian’s rise on the global stage couldn’t come at a worse time for OPEC. Just last November they cobbled together a delicate deal to address the oil glut by cutting production.
The key is that the unique geology of the Permian allows frackers to hit multiple layers of oil as they drill into the ground. That’s what sets the Permian apart from other major oilfields. And it makes it lucrative to drill there even at today’s sub-$50 prices.