Much open discussion through the press has been given to the 'break even price' as it relates to the ability of producers to economically develop shale oil resources in a low-price environment. The range of prices has been stated by many parties ranging from as low as $20 per barrel to more reasonable projections of between $50 and $60 per barrel in the next 6 to 12 months. The break-even price estimates are the basis of increased activity as reflected by the surge of active rigs since the [Read more]
US shale oil reaching 10 million barrels per day is fiction
Any financial advisor worth their salt will caution you that past performance is not a guarantee of the same in the future. And so it is with US shale oil. Recent EIA estimates claim potential production of up to 10 million barrels per day (BPD). That projection is pure fiction and in this article I will explain why. Right off the bat, assuming annual declines of 2.0 Million BPD, wells having a 365-day average annual rate of 400 BPD requiring 5,000 wells and utilizing 330 rigs (with each well [Read more]