Posted: 22 Mar 2015 11:48 PM PDT
As
we pointed out early on in the oil price bust, following the argument
of John Dizard of the Financial Times, shale gas operators, aka
frackers, were often carrying so much debt that they simply could not
afford to cut production. They'd keep pumping, even at a loss, to
generate cash flow to keep servicing their obligations. Over-production
would tail off only when the money sources dried up.
As we've since chronicled, even though rig counts have fallen, shale gas
production has actually increases. Arthur Berman provides a detailed
look at tight oil and shale gas output, and confirms that the rig count
cuts for shale gas have not been deep enough.http://www.nakedcapitalism.com/2015/03/shale-gas-orgy-production.html?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+NakedCapitalism+%28naked+capitalism%29
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