(Bloomberg) -- Oil output from the prolific Permian Basin of West Texas and New Mexico is poised to rise to fresh record this year as drilling gets more efficient, according to a major US pipeline operator.

Production from the basin is set to reach 6.4 million barrels a day at the end of this year, up from 6.1 million barrels at the end of 2023, Plains All American Pipeline LP said in its fourth-quarter earnings presentation. The growth will happen due to drilling efficiencies even as the number of rigs remains stable, Chief Financial Officer Al Swanson said. 

Three hundred rigs are “probably doing the work of close to 330 rigs 12 months ago,” he said. In the long term, Swanson also sees the industry increasing the amount of oil pumped from each well compared with the total volume available in the field. The Permian’s Delaware Basin will lead the increase while production in the Midland section will remain stable, Swanson said. 

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Last year, total US oil production soared by 1 million barrels a day as explorers drilled deeper and longer wells — some stretching for miles — to extract more crude. The surge helped American crude exports rise to a record, putting pressure on OPEC to restrain output and supplying European buyers who’ve turned away from Russian crude because of the war in Ukraine. 

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