There’s a growing body of evidence by those doing the work, crunching the numbers, and keeping an eye on oil & gas production and well productivity, which suggests future shale production may disappoint going forward. This aligns with the thesis that US shale basins have been “high graded.” This is a mining term which describes a scenario wherein the producer mines the cheapest and most productive resources first, despite the potential of rendering the remaining resources uneconomical. If this has occurred in America’s shale basins, we are probably headed for much higher energy prices in the long run.
The following Tweet thread by Shubham Garg presents some recent evidence of this from Pioneer Resources operations in the Permian basin:
Pioneer Resources, the biggest producer in the Permian just brought 15 wells onto production in their core Midland basin asset.
— Shubham Garg (@WhiteTundraSG) September 14, 2022
10 out of the 15 wells came in with IP24's below 1,000 boe/d and overall, these 15 wells averaged IP24's of just 885 boe/d.
🧵 pic.twitter.com/LxkGUBKoJI
There’s also a recent article from the Financial Times titled US shale bosses tell Europe: ‘There’s no bailout coming’, linked here and below, which hints at the same issue.
https://www.ft.com/content/ef4fb2b8-1b28-43f3-b34f-13e98c769e63
Lastly, and since I used his graph, I highly recommend Rory Johnston‘s substack on the crude oil and energy markets. You can read his latest on Shale Struggles linked here, or below:
https://www.commoditycontext.com/p/shale-struggles?utm_source=profile&utm_medium=reader2
Recent Posts___________________________________________________________________
![Coal News Coal Markets, Russia](https://thecoaltrader.com/wp-content/uploads/2024/01/Russian-coal-train-600x600.jpg)
Russian Coal Industry Faces Mounting Challenges in 2024 Amid Declining Exports and Production Shifts
![](https://thecoaltrader.com/wp-content/uploads/2024/04/conosl-marine-terminal-port-ceix-600x600.webp)
CSX Curtis Bay Coal Terminal Incident Causes Shipping Delay
![Coal Mining Coal Stockpile West Virginia](https://thecoaltrader.com/wp-content/uploads/2024/01/coal-stockpiles-west-virginia-600x600.png)
![Coal Mining Steel HRC Europe](https://thecoaltrader.com/wp-content/uploads/2024/03/HRC-Europe-Steel-600x513.jpeg)
EU’s Anti-Dumping Probe on Hot-Rolled Steel Sparks Global Reactions
![](https://thecoaltrader.com/wp-content/uploads/2024/08/SCOTUS.jpg)
Moody’s: SCOTUS Chevron Ruling Raises Uncertainty for Power Sector
![](https://thecoaltrader.com/wp-content/uploads/2023/12/Enel_Fusina_Coal-plant-600x334.jpeg)
Keep functioning ,terrific job!