Every basin has a year where the production story diverges from the rig-count story. 2026 is that year for the Permian.

Active rigs across the Midland and Delaware sub-basins are down roughly 12% from this time last year. Most royalty owners hear that number and assume their next check is at risk. The reality, which we see across hundreds of statements every quarter, is more nuanced — and for most owners, more favorable.

The productivity-per-well number is what to watch.

Permian operators have been getting better at extracting more oil from each well for fifteen years running, and 2026 is no exception. EUR (estimated ultimate recovery) per lateral foot is up another 4–6% year-over-year across the major operators we track. When rig counts decline by 12% but per-well productivity climbs 5%, the basin’s net oil production stays roughly flat or even grows.

For a royalty owner sitting on a producing interest, that translates to checks that don’t drop the way the rig-count headlines might suggest. The wells already drilled — your wells — keep flowing on their own decline curve, which is generally well-understood and predictable. What’s not going to land in your mailbox is the boost from new drilling on offsetting acreage. That’s the part that matters for new files.

What this means for sizing a loan.

When we underwrite a Permian royalty in 2026, we’re looking at three things in roughly this priority order:

  1. The decline curve on your existing wells. We pull operator data, cross-reference with the public TRRC records, and model the next 60–84 months of production. This is the biggest input to the multiple.
  2. The operator’s drilling commitment in your section. If the operator has filed permits or has announced plans to drill offset wells inside the next 24 months, that’s upside we’ll size into the loan. If the section is fully developed and won’t see new drilling, we model from existing production alone.
  3. Pricing exposure. WTI has been bouncing in a $68–$82 band for most of 2026. We stress-test our underwriting to $55 — if the loan math still works at that price, we feel good about funding.

“A producer’s worst year shouldn’t break the loan. That’s the underwriting test.”

The practical answer for a Reeves County owner.

If you’re sitting on a 3-well royalty interest in Reeves County producing around $2,400/month, here’s roughly what 2026 looks like:

  • Loan range: $48,000 – $57,600 (20–24× monthly royalty).
  • Term: typically 36–48 months, repaid out of the royalty stream itself.
  • Decision time: 48 hours from receipt of statements.
  • What we’d want to see: three months of statements, the operator name, and the section/township so we can pull the public production data.

Permian production economics are healthier than the rig-count headlines make them look. If you’ve been holding off on a conversation because you saw a “drilling slowdown” headline, that headline isn’t your story — your story is on the statements you already have in a drawer somewhere.

Send those statements. We’ll quote you a number inside 48 hours.