TEXAS RIG COUNT- The price of oil and gas has been increasing a little lately but the number of new oil and gas drilling permits issued in Texas has declined sharply over the past few months. The Texas Railroad Commission, which regulates the industry, reports permits for new wells in May were down more than 300 percent [318.3% ] compared to the same time last year. Ed Longanecker, who heads the Texas Independent Producers & Royalty Owners Association, expects the plunge in production to continue.
"Some believe that we'll bottom out maybe in June, " Longanecker said. "But I anticipate that we're going to see a further reduction in domestic production until the later part of this year."
As to when things will improve, Longanecker says that will depend on a rebound in the US economy.
"It could be mid or late next year until we see start to the industry turn around and some are projecting 2022 until we get back to some level of normalcy," explained Longanecker.
Longanecker is part of a task force working with the Railroad Commission and state lawmakers to develop policies to support the Texas energy sector during the economic downturn.