The Palo Duro basin of the Texas Panhandle is filled primarily with Pennsylvanian, Permian, and Triassic strata that record the depositional history of a shallow cratonic basin. Regional deformation during Early Pennsylvanian time across a belt encompassing the southern Oklahoma and Delaware aulacogens resulted in the formation of the basin. Rapid basin subsidence and marine transgression dominated Pennsylvanian depositional history but was followed by marine regression and rapid filling of deeper parts of the basin during Early Permian (Wolfcampian) time. Pennsylvanian and Lower Permian strata consist of four major facies assemblages or depositional systems. An extensive fan-delta system is composed of arkosic sandstones eroded from Precambrian highlands flanking the bas n and deposited by braided streams along the margins of the basin. In the southeastern part of the Palo Duro basin, westward prograding, high-constructive deltas dispersed sediment across a shelf environment and into basin and slope environments. A thick, massive sequence of limestone accumulated seaward of the deltas in a carbonate-shelf and shelf-margin system that encircled most of the basin. The slope and basin system consists of terrigenous clastics that were funneled downslope into deep basinal environments by feeder channels that formed along shelf margins.

Interplay between basin subsidence and local sedimentological controls determined the depositional style and resulting facies patterns. Rapid Pennsylvanian subsidence combined with invasion and deposition of terrigenous clastics across carbonate-bank environments caused parts of the northwestern shelf margin to retreat westward toward shallow, clear water. During Early Permian time subsidence rates slowed and sedimentologic controls dominated basin evolution. Thick slope wedges, which were formed by deltas that prograded to shelf edges and debouched sediment into the slope environment, created shallow foundations for subsequent carbonate-bank development and progradation.

Porous shelf-margin dolomites, delta-front sandstones, and fan-delta arkoses are considered potential reservoirs for oil and gas. Potential source rocks may be present in adjacent, thick basinal and slope shales.