March 6 (UPI) -- ExxonMobil will surpass one million oil-equivalent barrels per day production in the Permian basin by 2024, an 80 percent increase, while Chevron separately announced it will increase its Permian output to 900,000-barrels-per-day in 2023.
"Our plans are attractive at a range of prices and we expect them to drive more value as we continue to lower our development and production costs," Neil Chapman, senior vice president at ExxonMobil, said Tuesday
ExxonMobil's investments in the Permian Basin will produce returns even at low oil prices. At a $35 per barrel oil price, for example, Permian production will have an average return of more than 10 percent, the company said.
Construction will include facilities to handle 600,000 barrels of oil and 1 billion cubic feet of gas per day through 350 miles of already-laid pipeline. ExxonMobil is one of the most active operators in the Permian with 48 drilling rigs in operation, and plans to reach 55 by year's end.
As for Chevron, the company said in a Tuesday release that in the Permian Basin the company has added "almost 7 billion barrels of resource" over the past two years.
Chevron said its Permian unconventional net oil-equivalent production will reach 600,000 barrels per day by the end of 2020, and 900,000 barrels per day by the end of 2023.
Chevron projects a three to four percent compound annual production growth rate through 2023. It expects about $30 billion of cash generation at $60 Brent in 2019.
The Permian Basin is an area in West Texas that not long ago had been long in exploitation. However, hydraulic fracturing technologies allowed producers to recover more resources. This added output in recent years has turned the United States into the world's biggest crude oil producer, as the shale technologies were used in areas across the United States.
The Permian Basin and the Gulf of Mexico account for about half of the nation's output, now at a record 12 million barrels a day, according to a Houston Chronicle report.
The Permian Basin has been producing for nearly a century and still contains large resources of oil and natural gas.