Divergent views on Lower 48 cost trends: higher or lower? Report

Insight 05 October 2023

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Report summary

Predictions about cost trajectories for 2024 diverge among Exploration and Production (E&P) companies and oilfield service (OFS) providers. Even among E&P companies, a consensus is lacking. While some E&Ps anticipate cost deflation, others foresee rising costs. OFS companies have a more optimistic outlook on pricing, prioritizing margin preservation over market share and relying on an expected uptick in activity in 2024 to stabilize pricing. Will Lower 48 well costs be higher or lower in 2024?

Executive Summary

Tables and charts

This report includes the following images and tables:

Dallas Fed Survey question - What are your expectations for your firm’s drilling and completion cost per well in 2024 versus 2023?
Lower 48 Horizontal Rig Count Forecast
Rig day rates and Pressure pumping rates

OCTG 9 5/8 casing prices and Permian in-basin sand prices
Quarterly well cost forecast - Delaware Wolfcamp (exluding efficiency gains)
Cost savings from efficiency improvements (10% faster drilling, 20% faster completion)