Upstream Intel 5/27/25
Interest in old rock | New Wyoming reserves | E&Ps shrug off macro uncertainty | Permian wastewater hits land integrity
Welcome back to Upstream Intel, Lease Analytics’ weekly roundup of our analysis and insights. As always, we would love to hear from you with news ideas, feedback, and anything else you find interesting.
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Data Drill: What’s old is new again
New old rock drives this year’s exploration
The oil industry's smartest money is betting on overlooked assets from past acquisitions rather than chasing expensive new prospects.
Occidental is systematically developing secondary formations inherited from its $12 billion CrownRock deal, with wells already producing 90,000+ barrels from previously ignored Strawn zones. Continental sits on what CEO Doug Lawler calls the company's deepest exploration portfolio in 15 years, all within existing acreage deemed uneconomic a decade ago.
In turn, operators are applying hard-won technical expertise to familiar geology in new locations, essentially copy-pasting successful plays across basins, Hart Energy reports.
Exxon, Marathon, and Continental are leveraging decades of Woodford Shale experience from Oklahoma to unlock similar formations in the Permian. This strategy eliminates geological risk while capitalizing on established operational knowledge, delivering faster returns than greenfield exploration.
The redevelopment thesis extends beyond secondary zones to enhanced recovery from existing wells, where operators see immediate upside with minimal additional risk. BPX Energy is targeting 25% recovery rates by combining primary development with refrac programs across 400+ candidates, while Continental notes that modern techniques now make "poorer-quality rock" perform like historical Tier 1 acreage.
DOI announces new reserves in Wyoming
A new federal assessment has unlocked 473 million barrels of oil and 27 trillion cubic feet of natural gas in southwestern Wyoming, resources worth tens of billions sitting in formations operators have successfully drilled for 70 years.
The U.S. Geological Survey identified these undiscovered reserves within the Mowry Composite system, which has already produced 7.3 tcf of gas and 90 million barrels since the 1950s, Reuters reports.
This assessment provides the perfect foundation for expanded drilling on public lands, giving the Bureau of Land Management scientific backing to justify new permits in proven formations.
Companies can now target specific undiscovered pockets within familiar geology like the Dakota Sandstone, Muddy Sandstone, Mowry Shale, and Frontier Formation, where existing infrastructure and decades of operational experience minimize exploration risk. The timing aligns with falling regulatory barriers under the new administration, creating immediate opportunities for operators to access substantial federal reserves.
Price wars and rumors of price wars don’t shake hard-won stability
We’ve previously talked about the data quality problems stalking confident upstream decisions and, separately, about OPEC+ market manipulation. This week, we see a combination of both.
Reuters frames Riyadh’s surprise output hike as strategic aggression—aimed at punishing overproducers and kneecapping U.S. shale. SEB counters that it’s simply seasonal, tied to air conditioning and pilgrimage demand. Bloomberg offers yet another angle, suggesting the price cuts are a political favor to President Trump ahead of a summer he wants to keep cheap at the pump.
You wouldn’t know it from the headlines about the decline of U.S. shale, but the oil patch isn’t flinching. Despite prices brushing against break-even territory and media chatter predicting collapse, the majors and disciplined independents have stayed measured.
Disciplined mentally as well as financially, E&Ps are tuning out the noise, appeasing Wall Street, and resisting overreaction to the bi-directional price volatility hovering near break-even.
“Don’t bet against our industry.”
— Ryan Lance, CEO, ConocoPhillips, speaking at the Qatar Economic Forum
Travis Stice may have declared a shale plateau, but the real story is how quietly and confidently that message has been absorbed, across the patch and in the boardroom.
There’s no panic, just preparation. Whether it’s Conoco’s modest growth outlook, Prairie’s mid-$40s breakeven, or Shell’s insistence it can fund dividends at $40 oil, operators have internalized a new volatility playbook.
This positioning is a cautiously optimistic sign. When prices wobble but behavior holds steady—“wait-and-see” mode without hard pullbacks—it signals not just fiscal discipline, but long-term confidence.
That’s notable beyond the oil sector, where much of corporate America still struggles to build a durable footing amid macroeconomic and policy uncertainty.
In Other News:
Wastewater threatens Permian geology
Texas regulators are finally acknowledging what landowners have warned about for years: massive wastewater injection from fracking is causing "widespread" pressure increases that threaten both oil production and groundwater supplies across the Permian Basin, Bloomberg reports.
Wastewater volumes have become so large that toxic fluids are breaching wells and causing ground deformation, with companies like Coterra forced to halt production when waste leaked into active drilling sites. The geological challenges represent a serious threat to the Permian as producers face costly choices between pumping wastewater farther away, increasing recycling, or paying for expensive treatment.
Texas RRC issues new well disposal guidelines
The Railroad Commission of Texas has imposed stricter saltwater disposal well permitting requirements starting June 1, doubling the area of review to half a mile and setting pressure and volume limits based on reservoir capacity. The new guidelines require operators to demonstrate their injection pressure won't fracture confining rock layers, and assess old wells within the expanded radius to prevent toxic water escapes.
Quality over quantity is the new M&A game
Oil M&A strategy is shifting from acquisition scale to surgical precision, as companies abandon the growth-at-any-cost mentality that defined recent mega-deal cycles. Buyers are now prioritizing operational excellence and synergistic assets over pure scale expansion, as producers like Matador target high-graded undeveloped inventory over immediate cash flow.
Quote of the Week:
“The best place to find oil, oftentimes, is where you’ve already found it.”
— Ring Energy Chairman and CEO Paul McKinne
What We’re Reading:
Occidental to invest $30bn in extended Oman concession. (Arab Gulf Business Insider)
North Dakota oil producers plan to drop rigs due to weaker prices, state regulator says. (BOE Report)
Permian Gas Bottleneck Demands More Takeaway Capacity, Execs Say. (Hart Energy)
Infinity accelerates Marcellus project, weighs slowing of oil-focused work. (Oil and Gas Journal)
Judge Revives Suit Challenging BLM Lease Sales In Utah. (Law360)