Insight
Chevron and ExxonMobil to ramp Permian: drivers and implications
Report summary
Are the Majors more nimble than the independents? ExxonMobil and Chevron celebrated the addition of key ‘short cycle’ tight oil projects to their global upstream portfolios a few years ago. However, over the past 12 months, Chevron and ExxonMobil’s rig additions were muted while WTI surged. But after a quiet 2021 in the Permian, we believe both remaining Majors are set to ramp Wolfcamp activity. It’s a move we’ve been eagerly awaiting. Chevron’s December announcement of a 50% budget increase in 2022 and ExxonMobil’s reaffirmation of its 2024 production target proves that the Permian remains core to each company, even with quickly developing low carbon strategies. We investigate three core reasons why 2022 will be a critical year for each company’s Permian project. Shale independents will likely hold rigs relatively flat while ExxonMobil and Chevron add to their operated fleet.
Table of contents
- Executive summary
- The ghost of Permian past
-
Permian commitment confirmed
- 1. Cash flow
- Too big to miss
- 2. Advantaged assets: reducing global emissions intensity
- 3. Quick payback, high volume growth
- Extending Permian leadership
- What's next?
-
Appendix: still a lot to prove
- Modelling notes
Tables and charts
This report includes 16 images and tables including:
- Permian production by quarter: tracking up but not fast enough to hit targets
- Chevron and ExxonMobil evolving Permian well metrics
- 2025 Permian production share (boed) – Majors meeting targets
- Majors’ shale scorecard
- Production scenarios – Chevron
- Production scenarios - ExxonMobil
- Scenario cash flow – Chevron
- Scenario cash flow – ExxonMobil
- ExxonMobil emissions ranking
- Chevron emission ranking
- Net production by resource theme – Chevron
- Net production by resource theme – ExxonMobil
- Post-tax value – average Permian well
- Chevron scenario reinvestment rate
- ExxonMobil scenario reinvestment rate
- Price assumptions
What's included
This report contains:
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