Two years after the worst oil price collapse in a generation, medium and large independent US producers survive and eyeing the growth again as oil nears $ 50 a barrel, confounding OPEC and Saudi Arabia with their resilience.
This shale giant Hess Corp (HES.N), Apache Corp (APA.N) and more than 25 other companies have beaten back the attempt to marginalize OPEC would have been unthinkable a few months, when oil plumbed $ 26 a barrel and the collapses were feared.
to regain market share, the OPEC at the end of 2014 pumped more oil despite increasingly global overproduction. It aimed to push down prices and force producers to higher costs in the market, with oil shale considered particularly vulnerable.
The pain was acute. Industry revenues fell more than 30 percent in 2015 over the previous year, the number of US wellbore fell more than 70 percent from when oil was still above $ 100 barrel, equity valuations plunged and dozens of small producers declared bankruptcy.
But until now, no US producer who pump more than 100,000 barrels per day (bpd) went bankrupt. The survival of these large producers explain why the total production of the United States slipped only about 10 percent from the peak of 9.69 million barrels per day
Their agility -. Requiring slashing costs in half while doubling down on improved techniques to squeeze more oil from each new well -. now allows the industry to focus carefully on growth again
But this time, US producers say they will stay focused on the return on capital, after abandoning a culture of maximizing Production regardless of costs.
OPEC and Saudi Arabia "thought there would be major capitulation and damage to shale producers in the United States because of the deep recession," said the Csorba, a leadership consultant Heidrick & Struggles who works with shale frames. "But what happened is that he actually created a new paradigm among US producers to transform their businesses."
The acquisition activity has picked up considerably in recent weeks, with Devon Energy Corp (DVN.N) find buyers for more than $ 2 billion in non-core assets. The company uses part of this money to increase its capital budget of $ 0 million.
WPX Energy Inc (WPX.N), who spent more on acquisitions last year than any US oil company, sold 45 million new shares earlier this month, intends to use the funds to drill new wells in Texas.
"We are a leaner organization than we were before the collapse of prices," said Rick Muncrief, CEO of WPX.
Certainly, costs have been reduced to match the price decline when oil plumbed $ 26 per barrel in February and "there is a perception out there that if prices of commodities back, you will lose these cost savings, "said Muncrief
But he said ,." that is simply not the case "
Industry consensus holds that the costs of oil services. - fracking and the like - can increase in tandem with oil prices, although high-tech advances in technology sand, drilling and chemical should remain.
"real progress for us came from the cost side," said John Christmann, CEO of Apache. "We plan to maintain a disciplined approach to the cycle with a focus on returns. "
US oil prices have recovered CLC1 nearly half of their losses compared to mid-2014 peaks, almost doubled compared to the 13-year low hit in February to more than $ 51 in early June
There is one year prices reached similar levels before diving. oil executives hope past prologue.
"people need not be panicked, "said Sam Xu, an investment banker with CohnReznick Capital Market Securities LLC. ". Instead of trying to keep their heads above water, they are now trying to get back in the game "
To be sure, some executives say a little more is needed - at least $ 60 a barrel - the ramp of the drilling and fracturing in most US shale plays
This attitude was reflected in the investment budgets of the oil producers, who are still billions below. 2015 levels.
Hess has long said it will add the platforms in North Dakota, when oil prices reached this mark, even if it is profitable in the state to 40 $.
"We need to see a period of price stability," Greg Hill, Chief operating Officer at Hess said. "We need to make sure it's not quicksand . "
Some oil companies are unwilling even to acknowledge the $ 50 relevant step.
"We head down and work and not ready to take any kind of victory lap," said Kristin Thomas, spokesman for Continental Resources Inc (CLR.N), the second largest oil producer in North Dakota.
others argue in the Bakken, Eagle Ford and Permian, the United States considered the cheapest and most prolific oil shale fields.
"Permian is set up for a pretty explosive growth in the coming years," Scott Sheffield, CEO of Pioneer Natural Resources Co (PXD.N) during an S & P global conference Platts. Pioneer this week said it would increase its fleet to 40 percent rig.
However, most producers are moving slowly.
"people will wait and see if that $ 50 price sticks around, "said Muncrief the WPX CEO.
Reuters
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