Where the Next Decade of Drilling Inventory Comes From

TL;DR

• The best drilling locations are being developed first, so the next layer of inventory is moving into newer zones, such as the Barnett-Woodford in the Midland Basin. The Barnett Woodford in the Midland Basin is generating a lot of investor interest in response to growing concerns around a lack of tier 1 inventory in North America.
• Enverus Intelligence® Research (EIR) estimates that the Barnett-Woodford holds more than 6,400 modeled locations. That estimate, and the zone’s breakeven, depend on assumptions about spacing and well costs.
• With exploration still low, replacing drilled inventory may be getting harder.

What this means for investors

• Inventory is a key valuation input, being able to scrutinize the underlying assumptions behind it is a major consideration.
• Test any inventory case at your own spacing and cost assumptions before it reaches an investment committee memo.
• Ask which operators hold the inventory and whether it clears your return hurdle under the case you choose.

Source: Enverus Intelligence Research, Midland Barnett-Woodford report (September 28, 2026) Key Points.

Upstream investment cases depend heavily on how many locations an operator can still drill. In this post, “inventory” means modeled undeveloped drilling locations, not booked reserves. Operators tend to develop their highest-return locations first. Investors therefore need to ask where future inventory could come from and how much will hold up under the assumptions they would use to underwrite it.

The Midland Barnett-Woodford report points to one possible source: a less developed zone with more than 6,400 modeled locations. EIR estimates those locations represent about 3 billion barrels of undeveloped recoverable oil, the largest amount among the basin’s interval groups.

Average well performance in the zone was more than 30% above the Midland Basin base’s uphole intervals in 2025. EIR estimates a breakeven of about $41 per barrel, assuming well costs of $800 per foot.

The chart uses a different breakeven measure. It shows Barnett-Woodford resource by PV-10 breakeven, using a 20:1 WTI-to-Henry Hub ratio. Most of the resource falls between $40 and $50 per barrel.

Exxon Mobil (XOM), Diamondback Energy (FANG) and Occidental Petroleum (OXY) hold the most reported drilling locations in the zone, at roughly 1,250, 750 and 500, respectively. For a number of smaller companies with fewer absolute Barnett-Woodford locations, the interval represents a higher relative proportion of total remaining Permian inventory and will be heavily relied upon for near-term development.

Source | Enverus Intelligence® Research, Enverus Placed Well Intelligence; adapted from Figure 3, “Gross Operated Barnett-Woodford Inventory by Operator,”

Investor Questions

• Private equity: Check whether the valuation still holds at the cost deck you’re underwriting. If the zone only works at the operator’s costs, the valuation carries that risk.
• Investment banking: Expect buyers and sellers to argue over inventory counts. Know which spacing case each side is using before the deal is marketed.
• Hedge funds and long-only: Compare how many years of drilling each operator’s inventory supports, using the same assumptions. Headline location counts can hide differences in how much of the inventory sits in proven versus unproven zones.

The investor question is which operators hold the inventory and whether it clears a return threshold under the spacing and cost case being considered. Placed Well Inventory can help assess operator-level locations. Because operator attribution is a prediction, confirm it for any company in a live deal.

In EIR’s view, the next decade of inventory will be priced whether or not the assumptions are checked.

See how Enverus can help test inventory under your own spacing and development assumptions.