Over the last several years, earthquakes in the Permian basin have increased in both number and intensity. In 2022 there were more than 8x the number of magnitude 3 earthquakes or greater than those that occurred annually in in the years from 2015 to 2019. (Exhibit 1). In fact, two of the five largest tremors in Texas’s history occurred during the fourth quarter of 2022.
Exhibit 1: Number of 3+ M seismic events in Texas and New Mexico (Source: B3 Insights, ADI Analytics)
Regulatory response
This increase in activity has kept operators and regulators busy. In the Delaware basin, the Texas Railroad Commission (RRC) established the ~2,300 sq. mi Northern Culberson-Reeves (NCR) Seismic Response Area (SRA) in October 2021 in an effort to prevent the occurrence of higher magnitude events in the area. In December 2022, they expanded it to ~2,600 sq. miles after the 5.4 earthquake in Reeves County on November 16. Operators in the area have agreed to collectively reduce produced water disposal volumes from 298,000 b/d to 162,000 b/d by June 2023.
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