Permian Pulse: What ever happened to the southern Midland Basin?

Don’t look now but the rig count in the once-forgotten southern Midland Basin is on the rise again.  There are now a combined 37 horizontal rigs active in Upton, Reagan, Irion and Crocket counties, impressive when put into the context that there are 42 active rigs in the entire Williston Basin. Wisdom from 2014 would tell us that the southern Midland is no good, so what has changed to bring activity back? The easy answer, of course, is oil price as we estimated last year the southern part of the basin needed $48/bbl to see material activity return. But it’s a lot more than just some price support, forget what you thought you knew about the southern Midland – it’s a new play today.