Insight
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6 Pages

Can tight oil costs fall enough?


Can tight oil costs fall enough?

Report summary

Tight oil producers' initial response to the 2014 price collapse was to cut costs. After the initial WTI price shock, producers worked aggressively to lower the cost of supply from onshore US tight oil plays. The more recent downward price movements are indeed cause for concern, but our models suggest that the additional cost savings required for wells to break even in a prolonged period of US$45/bbl WTI are not unprecedented, and some operators have plans and processes to achieve them.

What's included?

This report includes 1 file(s)

  • Can tight oil costs fall enough? PDF - 292.66 KB 6 Pages, 1 Tables, 3 Figures

Description

This Unconventional Oil and Gas Insight report highlights the key issues surrounding this topic, and draws out the key implications for those involved.

This report helps participants, suppliers and advisors understand trends, risks and issues within the unconventional oil and gas industry. It gives you an expert point of view to support informed decision making.

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.

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  • Cost cuts to date
  • A late summer shift
  • A new downside scenario
  • Actually making the cut
  • Outlook

In this report there are 4 tables or charts, including:

  • Cost cuts to date
    • Changes in average US onshore well costs (2014 to 2015)
  • A late summer shift
  • A new downside scenario
    • Prior cost reductions and the additional cuts needed to break even at US$45/bbl
    • Absolute change in D&C needed to break even at US$45/bbl
  • Actually making the cut
    • Can tight oil costs fall enough?: Table 1
  • Outlook
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