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Focused tight oil operators have recently drawn attention to how field operating costs have fallen by 20-30%. Per unit opex is virtually always lower than capex, so how important is it to mange this expense in a low price world? Our models indicate that further reducing US tight oil opex in a US$30/bbl price environment can help support margins in a few NPV positive plays. But for those assets out of the money, additional opex reductions will not be enough to transform the assets into economic projects.
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This report includes 1 file(s)
Can falling tight oil opex save marginal plays? PDF - 408.48 KB 5 Pages, 1 Tables, 3 Figures
Description
Globally, the industry is looking for the next big unconventional discovery after the success seen in the U.S. Lower 48. Argentina's Vaca Muerta has shown it can go head to head with US plays. But, as investors looks for the next big unconventional opportunity, will Argentina be able to attract enough investment to exploit the shale's full potential?
This Vaca Muerta development study report provides ground-breaking well-by-well analysis of production, well performance, and economics. The play is divided into three distinct sub-plays and this report provides insight into production, acreage positions, costs, and type-well economics. The sub-plays likely to drive value creation are identified, as well as the oil and gas prices and efficiency gains needed to produce positive returns.
The study enables potential investors, governments and companies to evaluate the relative attractiveness and value of acreage positions. Furthermore, the study helps benchmark the performance of each Vaca Muerta sub-play with that of North American analogues.
These findings are based on original well data from Argentina along with Wood Mackenzie's expert analysis.
Wood Mackenzie's 500 dedicated analysts are located in the markets they cover. They produce forward-looking analysis at both country and asset level across the globe, backed by our robust proprietary database of trusted research. Proprietary data means a superior level of analysis that is simply not available anywhere else. Wood Mackenzie is the recognised gold standard in commercial data and analysis.
Wood Mackenzie's clients include every major player in the global energy, metals and mining industries. We are recognised as a leading authority by international and national energy, metals and mining companies, leading financial institutions, governments and government agencies. We work with a range of diverse teams within our clients, from strategy and policy makers, business developers and market analysts, through to corporate finance, risk teams and investors.
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As the trusted source of commercial intelligence for the world's natural resources sector for more than 40 years, we empower clients to make better strategic decisions with objective analysis and advice. Find out more...
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Insight | Mar 2016
Can falling tight oil opex save marginal plays?
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