Parsley Energy CEO seeks 20% cut in Texas oil output

By David Wethe on 3/30/2020

HOUSTON (Bloomberg) --Pioneer Natural Resources Co. and Parsley Energy Inc. are asking Texas oil regulators for an emergency meeting to consider curbs on state output as a collapsing oil market envelops the nation’s biggest crude-producing state.

Jointly signed by the chief executives of both companies, the letter seeks a virtual meeting among the three-member Texas Railroad Commission no later than April 13, according a five-page draft of the letter shared with Bloomberg News. Ryan Sitton, one of the commissioners, said earlier on Monday that the regulating body would discuss curbing oil output at its next meeting.

“We need dramatic government action, because we know the operators cannot uniformly talk together,” Matt Gallagher, chief executive officer at Austin, Texas-based Parsley, said in an interview.

The request from Pioneer and Parsley, both drillers in the Permian shale basin of West Texas and New Mexico, comes even as oil and gas industry groups push back against potential output cuts. The American Petroleum Institute has blasted Sitton’s plan to curtail production as a “shortsighted” and “anti-competitive” effort that will “harm U.S. consumers and American businesses.”

But Gallagher said Texas output should be cut by 20%.

“Taking this action from a state level I think will help enable discussions at an international level from our federal government,” he said.

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