Just past the edge of the downcycle’s scary shadow, the Permian stands as an outlier—a contrarian basin in 2016. Operators here have added rigs, made flashy A&D transactions and cranked up production.

Texas Railroad Commission data from June shows that the nearly five dozen counties associated with the Permian Basin produced 40.8 million barrels (MMbbl) of oil—a 14% increase from June 2015.

With billions spent to acquire Midland and Delaware basin acreage, operators aren’t likely to sit idle on their new or expanded cores.

That makes the Permian ripe to play spoiler to the shale oil slowdown that was supposed to right prices.

August looks to be more of the same, oil and gas consulting firm Rystad Energy said Aug. 31. U.S. onshore oil production has stopped its decline as the Permian counteracts falling production in the Eagle Ford Shale and Bakken.

In the Lower 48, excluding the Gulf of Mexico (GoM), Rystad said oil output in August appears to be 120 Mbbl/d greater than the U.S. Energy Information Administration’s (EIA) production estimates for the month.

“Nearly 70 rigs in the Permian Basin have returned to operation since early May, and current horizontal drilling activity in West Texas and New Mexico is comparable to the levels observed” from second-quarter 2015 through fourth-quarter 2015, Rystad said.

The Baker Hughes rig count since mid-April shows the Permian Basin has climbed by 41%, about 58 rigs, to 199. However, 255 rigs operated in the Permian in August 2015.

Tudor, Pickering, Holt & Co. (TPH) has said the Permian’s robust M&A market is likely to accelerate rig activity.

“Recent transactions likely push the industry to accelerate the drillbit to drive NAV [net asset value] accretion given upfront valuations paid to acquire acreage,” TPH said.

Recent deals signed by SM Energy Co. (NYSE: SM) for $980 million; PDC Energy Inc. (NASDAQ: PDCE) for $1.5 billion; and Concho Resources Inc. (NYSE: CXO) for $1.625 billion are likely to shift capital spending to the Permian.

Additional completions on a backlog of drilled but uncompleted (DUC) wells are also boosting production, raising Permian volumes; and these are “sufficient to balance the decline from more mature liquid plays in September-October 2016,” Rystad said.

By contrast, major operators in the Bakken and Eagle Ford have not yet accelerated fracking activity, and several companies have called for a WTI price level of $55/bbl to $60/bbl to ramp up.

“However, as base production in these plays gets more mature, new activity in the Permian Basin will not only balance the decelerating decline in other plays, but will restore the growth trend in U.S. onshore oil production in November and December 2016,” Rystad said.

From June to August, more modest declines in onshore oil production resulted from disruptions, includingmaintenance on major Alaskan fields and unplanned GoM outages in July, as well as threats from weather.

“These outages caused more severe decline in the total U.S. oil production than implied by the natural decline in the Lower 48 states,” Rystad said, adding that the EIA will likely continue upward revisions to production, which could slow down oil price recovery despite the counter-seasonal global stock draws in second- and third-quarter 2016.

The EIA has already increased the fourth-quarter 2016 production estimate by up to 240 Mbbl/d.

“However, we still observe that the current exit-2016 projections for Lower 48 oil production are about 450 Mbbl/d below Rystad Energy’s base case scenario,” the firm said. “Even with zero shale well completions between September and December 2016, Rystad Energy forecasts that Lower 48 oil production exits 2016 at 6.07 MMbbl/d.”

Rystad Energy is an independent oil and gas consulting services and business intelligence data firm offering global databases, strategy consulting and research products.

Darren Barbee can be reached at dbarbee@hartenergy.com.