This whitepaper explores the
maturing Permian Basin, where Tier 1 acreage will soon enough be drilled up.
The authors ask and answer what will replace investment in the Permian Basin.
The main answers given are Appalachia, Oklahoma’s Anadarko Basin, and the plays
in the Rockies. There are opportunities in Southern basins as well.
Appalachia’s Marcellus and Burket are natural gas plays. Its Utica play has a
narrow oil & liquids window currently being dominated by EOG Resources, but
most of its acreage is prospective for gas. The deep Utica in Pennsylvania is
currently producing large per-well gas volumes.
The Southern Basins – Permian, Eagle Ford,
Hayneville-Bossier
Looking at the Southern
basins, the Permian, Eagle Ford, and Haynesville are the biggest plays, and
each has large fairways for drilling. The Haynesville-Bossier play is
high-volume gas but also has higher drilling costs due to depth and
high-temperature/high-pressure conditions. The Permian and Eagle Ford have oil
and gas fairways, but the Permian is mostly oil with associated gas. In those
basins, operators have shifted priorities:
“Rather than expansion, operators are now prioritizing
scale, efficiency and returns. Most of
the big players there are looking to consolidate, to become more concentrated
and get higher returns and have scale in the area,”
Larger operators are
prioritizing their best acreage and selling off parts they don’t want. This
sometimes creates opportunities for smaller companies to acquire and develop,
or they may acquire non-operated assets.
“More notably, some operators are finding value not in
building large operated positions, but in assembling acreage and non-operated
interests that can be monetized through trades or sales.”
The Eagle Ford, they note, is
past its peak growth phase. Operators are mostly focused on efficiency. They
note that sometimes cheaper drilling and completion costs can make some acreage
economical that previously was not economical. Pipelines are often a constraint
in the Permian. Capital markets have also become more demanding:
“And the increasing influence of capital markets is
reshaping strategy across the board, with investors demanding stronger returns,
disciplined spending and more resilient balance sheets.”
Expansion is no longer a main
goal in the Southern Basins, but efficiency is becoming key as”
“…strategic positioning, operational discipline and the
ability to create value in a tighter, more consolidated market.”
Appalachia - Marcellus and Utica
The Appalachian plays have
plenty of running room and are expected to produce well for decades. They are
currently producing a third of the nation’s natural gas at mid-30s BCF per day.
One of the region’s biggest constraints has long been the ability to build
multi-state pipelines, where there is more public opposition and regulatory
hurdles than in the South and West. That does, however, increase in-basin
opportunities for projects such as natural gas plants, data centers, hydrogen
projects, and industrial opportunities. These in-basin projects could add 2-4
BCF per day of demand in the region over the next several years. Incremental
pipeline expansions can help, slightly increasing the ever-important pipeline
takeaway capacity. They note that technological advancements can turn Tier 2
acreage into Tier 1 acreage. Deep Utica produces very good economic results
despite higher well costs. The Utica oil window in Ohio produces results
comparable to the Permian Basin. They predict that Appalachian production could
rise to the low-40s BCF per day.
Oklahoma – Mainly SCOOP/STACK and Anadarko Basin, but Other
Plays as Well
Plays in Oklahoma include the
SCOOP and STACK plays in central Oklahoma and the Anadarko Basin plays in
Western Oklahoma. The Anadarko’s Cherokee Shale play has garnered attention in
recent years. Some features of the Oklahoma plays include low cost of entry,
abundant pipeline takeaway capacity, and the availability in most areas of
multiple hydrocarbons: oil, natural gas, and natural gas liquids, which give
companies optionality when pricing changes. Another feature is that most of the
area is drilled by smaller private companies, with few large public companies
involved. However, they also note that there can be geological challenges in
some areas, where very good wells can occur next to not-so-good wells. They
don’t mention it, but high amounts of water production are also a feature of
drilling in Oklahoma, so water handling and disposal costs can also affect
economics.
Rockies – Powder River, Uinta, DJ, Williston, and Several
Other Basins
Here, they emphasize that the
Rockies' plays offer consistency and repeatability, which are important for
economics. They note that there are still vast, undrilled areas in these basins
to explore.
“What we’re seeing isn’t opportunistic interest—it’s
strategic repositioning,” Evangelista said. “Capital is following assets that
can deliver steady returns over time, and the Rockies are screening well under
that framework.”
“The constraints are well understood. Regulatory
complexity at the state level, combined with infrastructure limitations and
distance from key markets, can impact both timelines and economics.”
“Over the next few years, the region’s role will likely
expand as operators prioritize durability over peak output. Success will depend
on a disciplined approach: understanding local regulatory environments,
deploying capital selectively and executing against long-term development plans.”
In Summary – Growth is No Longer the Goal: Capital
discipline, Inventory Depth, and Working with Infrastructure Constraints are
Now the Focus
In most U.S. basins, the
resource has been identified, and the once-important goal of growth through the
drill bit has been replaced by capital discipline and efficient development.
The Southern basin trends are consolidation and scale. The Appalachian
imperative is dealing with the logistics of pipeline constraints. In Oklahoma,
some growth is possible, with the advantages of getting in cheaply, having
product optionality, and abundant takeaway capacity. The Rockies feature
consistency and sizable inventory. Many operators are balancing plays in
multiple basins, seeking not growth but value and consistent returns.
“That shift is influencing everything from capital
allocation to deal-making. M&A activity, private equity reentry and
portfolio rebalancing all point to a more diversified approach to basin
exposure.”
“It also suggests a more nuanced future for U.S. energy
development. No single basin is likely to dominate in the way the Permian has
over the past decade. Instead, the next phase may well be defined by a network
of complementary regions, each playing a distinct role depending on cost
structure, infrastructure access and resource profile.”
References:
The
end of single-basin dominance is reshaping U.S. energy. BOK Financial. 2026. he-20260427-BOK+Financial-Hart+Energy+White+Paper.pdf
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