Insight
Can falling tight oil opex save marginal plays?
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Report summary
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.
Table of contents
- Opex ranges are wide
- Opex matters more now than ever
- Examining the trend
- A single bright point
- Additional headwinds
Tables and charts
This report includes 4 images and tables including:
- Lower 48 operating cost distribution
- Opex as a percent of total Lower 48 spend
- Sampling of company-specific operating cost reductions
- Marginal tight oil plays, current and required breakeven opex
What's included
This report contains:
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