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Devon Energy sees bright future in southeastern New Mexico

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By Zack Ponce

zponce@currentargus.com @zackponce12 on Twitter

POSTED:   06/12/2014 01:11:54 AM MDT0 COMMENTS

Photo courtesy Devon EnergyThe sun sets behind a rig operated by Devon Energy. The company continues to expand its operations in southeastern New Mexico.
Photo courtesy Devon Energy The sun sets behind a rig operated by Devon Energy. The company continues to expand its operations in southeastern New Mexico.
CARLSBAD >> Success has its benefits.

No one knows that better than those involved in the oil and natural gas industry in southeastern New Mexico. The boom that began to pick up in 2010 has led to unprecedented job growth and an official at Devon Energy doesn't think it will be ending anytime soon.

"We'll probably do around 160 wells this year and at the current pace it would take us over 30 years to drill up that inventory," said Tom Hooper, Devon Energy's business unit vice president for the Delaware Basin. "And that's just not wise business, so we'll have to ramp up our operations and still have a great program running for I'm sure well over 10 years."

Oil production for Devon's operations in the Permian Basin was up 36 percent in the first quarter of 2014 from a year ago, and the Oklahoma City-based company reached an average of 91,000 barrels of oil equivalent per day in the same timeframe.

Recently Devon has placed an emphasis on reinvesting the capital the company has accrued into Eddy County and the rest of the Delaware Basin, which Hooper believes is one of the best oil-bearing regions in North America.

"Honestly, it feels like one of the most stable places that I've ever seen in my career for long-term growth," Hooper said. "I worked this area 17 years ago and we thought we found everything then; and that was before horizontal wells and hydraulic fracturing at this scale, and it was before oil prices had taken off like they have. All of those things coming together has really just made this one of the best places that Devon can invest in right now."

Currently Devon operates 12 rigs in the Delaware Basin, the western area of the larger Permian Basin that cuts through Southeastern New Mexico and West Texas. The majority of those rigs are pumping crude from the Bone Spring oil reserve that is located approximately in the northeastern portion of Eddy County.

Devon has ramped up its operations this year with a focused horizontal drilling program at Bone Spring. The company has drilled 35 wells at Bone Spring that have produced an average of nearly 700 barrels of oil equivalent per day, making the area north of Loco Hills Devon's "most significant driver of our Permian oil growth," according to company spokesman Tim Hartley.

Devon currently employs around 200 workers in Southeastern New Mexico, most of whom are based out of the company's main office in Artesia. Devon also operates field offices in Carlsbad, Loco Hills, and Del Rey, Texas to support its field crews.

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