Operators Focus on Consolidating Acreage and Placing Higher Productivity Wells Online
2024 Overview
2024 was an interesting year in the oil and gas industry, marked by several billions of dollars spent on acquisitions and mergers. Before starting the year, the United States achieved record energy production surplus in 2023, setting the stage for a year of relatively low prices. Operators used this period of low prices to consolidate acreage and improve their positions for 2025. So, how much did a record energy surplus, lower oil and gas prices, and a year of acquisitions affect activity in the field?
Completion and Production Data
While more data continues coming in for the last quarter of 2024, the TGS Well Data Analytics application enables us to compare the number of wells completed in the first three quarters of 2023 and 2024.
Figure 1. Monthly US wells completed in the first nine months of 2023 and 2024.
Looking at wells completed, 2024 was a much slower year than 2023 due to several of the factors listed above. But while the number of completions has dropped, production has remained mostly stable through 2024, even setting a record for monthly crude production at 13,457 bbls/day in October. Although fewer wells are being completed, Figure 2 shows that new wells in 2024 are being brought online with higher productivity than new wells in 2023. This is a great sign that operators continue to be able to achieve more with less, implementing better drilling and production strategies and taking advantage of consolidated acreages.
Figure 2. Average first 3 months of oil production for wells brought online in the first half of 2023 and 2024.
Zooming in, we can see these trends continue at an operator level. In May of 2024, ExxonMobil’s acquisition of Pioneer Natural Resources for $59.5 billion dollars closed as the largest acquisition of the year. Figure 3 shows that in 2023, Exxon was averaging 73 wells completed per month. Exxon’s completions remained close to that benchmark, completing around 65 wells per month through May. After the merger closed in May, the rate of monthly completions dropped.
Figure 3. Monthly US wells completed by ExxonMobil in the first three quarters of 2023 and 2024.
Figure 4. Average first 3 months of oil production for wells brought online by ExxonMobil in the first half of 2023 and 2024.
While some completion activity may have dipped following a large acquisition, Exxon started 2024 off great, surpassing the 90-day oil benchmark they set in 2023, as can be seen in Figure 4 above. Production data for the end of 2024 continues to be updated, but Exxon, along with many peers who have navigated large acquisitions, are in an excellent position to capitalize on strong acreage positions coming into 2025.
For more information about TGS Well Data Analytics or to schedule a demo, contact us at WDPSales@tgs.com.