Something To Think About -- January 17, 2015

I'm going to come back to this later, but something to think about.

I think the low-cost operators coul drill and complete a well, prior to the slump in oil prices, for about $6 million in the Bakken. Prior to new completion techniques, costs were pretty much 50/50 between drilling and completing/fracking.

Let's say day rates for rigs decrease by 30%.

Let's say operators focus on drilling, delay fracking.

Or, let's say operators concentrate on re-fracking wells drilled back at the beginning of the boom. 

Something to think about.

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Rigzone Predictions: The Slump in Oil Prices

The articles on the slump in oil prices continue to come fast and furious. I will probably post/link many of them for archival purposes, though it's a bit tiring and repetitive.

Having said that, this is perhaps the best opinion piece I have seen to date on what the future holds with regard to the slump in oil prices. It was posted over at Rigzone a couple days ago. These articles are often archived and available by subscription only in a short period of time.

From that article, these are the main bullets. Go to the link for a more detailed look.

• upstream costs are the silver lining for operators
• refracks start to look better than new fracks
• Haynesville -- dry gas is back
• Eagle Ford remains the cream of the crop
• Permian M&A will heat up in 2H15
• US Gulf of Mexico activity will defy low oil prices
• operators ease off the gas in Canadian unconventionals ...
• ... and hit the brakes in the Canadian oil sands
• North American LNG loses some luster, but maintains momentum
• ethane is maxed out
• 2014 outages are a structure feature of the chemicals market, rathn than random variation
• Keystone XL remains in a holding pattern
• the MLP boom still has a bit of room to run
• US crude oil export policy -- evolution rather than revolution
• the benefits of Mexico's opening will accrue mainly to larger players

Regular readers should not be a bit surprised by any of these.

There is enough "stuff" in that article to keep me busy for months.