What shale companies will survive the blood

[zbest1966 + 10]

What SHALE companies will survive the, slowing of production, the lack of capital, and etc. 

[Gerry Maddoux + 3,627]

17 minutes ago, zbest1966 said:

What SHALE companies will survive the, slowing of production, the lack of capital, and etc. 

With all due respect, production isn't apt to slow very much. Sure, 300 rigs have been laid down but these new bottomhole assemblies can perform the darnedest things! MWD used to be exciting; now it's mind-blowing. Wells that used to take a month to drill--more if you hit a long range of granite--can now be performed in a week, tops. The bit ever seeks oil-bearing rock because there's machine learning. When Exxon paid the Bass Brothers 6.6 billion for their Delaware sub-Basin property, they meant business. They, along with Chevron, Occidental, Conoco and Marathon are going to hammer the shale. 

On the flip side, it's going to be increasingly difficult for any company without a refinery to make it in the shale business. This won't be the last bust we have to endure: when the price of wellhead oil is low, refineries usually do well, unless a recession is raging. And vice versa. In short, a refinery has always been a great hedge for oil companies, but now more and more petrochemical companies have been added to the mix, so the hedge is even greater. The "pioneers" of shale--EOG, Continental, Zavanna, Concho, and the pioneer itself (Pioneer)--are likely going to be bought out, or if they made a wrong acquisition at the wrong time (think Whiting), fall by the wayside. 

The next two years are going to see a flurry of mergers and acquisitions and no small number of failures, what with $126 billion of floated bonds coming due. No one on Wall Street is ponying up money for what has been an endless loss leader: there's no big Big lurking just around the corner. So, sadly, some really well-thought-out companies are going to fall because they just don't have the money to make the next jump. 

[zbest1966 + 10]

What do think Zell making an investment

[Gerry Maddoux + 3,627]

17 minutes ago, zbest1966 said:

What do think Zell making an investment

Because he's getting oil in the ground (rock) for about ten cents on the dollar. 

[Chris Kanaan + 22]

On 11/20/2019 at 1:29 PM, Gerry Maddoux said:

Because he's getting oil in the ground (rock) for about ten cents on the dollar. 

His oil in the ground is also located in California which is a very anti-oil state that constantly is making new restrictions and even trying to ban drilling outright.

I think Mr. Zell is a fool.  CRC will not make their bond payments.

[Gerry Maddoux + 3,627]

8 hours ago, Chris Kanaan said:

His oil in the ground is also located in California which is a very anti-oil state that constantly is making new restrictions and even trying to ban drilling outright.

Look up the Lost Hills Field, near Bakersfield. I wish I were that big of fool. That field has been going for at least 75 years. It is a nasty thing, with pump jacks everywhere, most of them going. Drill down 2,000 feet, strike oil, yields about 100 barrels a day. No fracking, no horizontal lines, costs about a $200,000 to drill. Good quality oil with infrastructure, so brings about $50/bll. Easy to drill there b/c nothing else there, dirty, smog. It just may be the most profitable oil to drill in the US. I don't know what it is but it's so highly pressurized in places that they used to have trouble controlling them. Big pools of oil in traps.

[Jabbar + 465]

11 hours ago, Gerry Maddoux said:

Look up the Lost Hills Field, near Bakersfield. I wish I were that big of fool. That field has been going for at least 75 years. It is a nasty thing, with pump jacks everywhere, most of them going. Drill down 2,000 feet, strike oil, yields about 100 barrels a day. No fracking, no horizontal lines, costs about a $200,000 to drill. Good quality oil with infrastructure, so brings about $50/bll. Easy to drill there b/c nothing else there, dirty, smog. It just may be the most profitable oil to drill in the US. I don't know what it is but it's so highly pressurized in places that they used to have trouble controlling them. Big pools of oil in traps.

He started buying in the shale plays also.  

 

[Manfred Kruger + 40]

Oils long term future is chalenging due to renewables and the onslaught of EV’s, and Californnia politics are despicable, but betting agaist Sam Zell is plain stupid