Chevron Corp. sees a “boom boom boom kind of economy” in West Texas, shrugging off signs of a Permian Basin slowdown showing up in everything from jobs to hotel rooms.
Steve Green, president of Chevron’s North American business, was insistent that the world’s biggest shale patch won’t be susceptible to historic boom-and-bust cycles that have dominated the Texas oil economy for decades. His booming nod to continuing good times came Tuesday during a panel discussion at the Lone Star Energy Forum in Austin.
“We see a long, healthy pace of activity in the Permian and Texas for decades to come,” Green said at the forum, sponsored by the Texas Oil & Gas Association.
The comments come within days of earnings releases by Schlumberger Ltd. and Halliburton Co., two of the world’s biggest providers of oilfield equipment and services, which detailed an annual drop in North American sales. The companies warned investors that the slowdown could be sharper than an end-of-year slump seen in 2018.
Don Templin, chief financial officer at Marathon Petroleum Corp., who was also on the panel, chimed in on the Texas love fest. But he also added an ominous warning.
The Findlay, Ohio-based refiner has access to global markets and a “good portion” of the 400,000 barrels a day of refined product that it exports is from the gulf coast. But he said investments in export infrastructure will be important in keeping the shale boom moving forward over the next five years.
“Texas plays a really important role,” he said. “But if you don’t have export capabilities, all the product produced in the Permian gets bottlenecked somewhere, and at some point in time, that will dampen the production.”
© 2019 Bloomberg L.P.