Texas oil boom has yet to peak

"Drill, Baby, Drill" is the mantra in West Texas, where oil production in the Permian Basin continues to surge. In fact, that region alone has the Lone Star State on pace for an all-time record oil output this year. Industry analysts predict within the next decade, production in the Permian Basin will more than double to about 6.5 million barrels per day. That has Texas on pace to surpass Iran and Iraq in production in the near future.

The only problem for energy companies is that they can't get the oil out of the ground and onto the market fast enough. "Their infrastructure has not really kept up with demand, especially in the hydraulic fracturing areas, so they are having problems with pipelines and shortages," says Kym Bolado, host of KTRH's In The Oil Patch. As a result, companies are now investing billions in new equipment, and hiring as fast as they can to address a worker shortage. "We should start seeing a little bit of some of the resources catching up with the area out there, and then of course there are other ways of transporting (the oil) as well," says Bolado.

In the meantime, oil prices have largely stabilized after a massive plunge in 2014-15. Despite the shortage of pipelines and workers, Bolado doesn't believe there is any threat of a short-term price spike. "There will probably be enough (oil) on the market to last us through the year, so I don't think that we're going to really see a whole lot of really big changes in this area," says Bolado.

The continuing boom in the Permian Basin, and the Eagle Ford Shale to a lesser extent, is not only great for Texas but for the nation when it comes to energy independence. "I do believe the United States is sitting in a much better place than they were five years ago, being somewhat of a contributor to the price of oil and no longer being subjected to just what OPEC is doing," says Bolado.

Listen to “In The Oil Patch” Sundays at 8 p.m. on Newsradio 740 KTRH.

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