”By front-loading the wells to boost early oil output, many companies have been able to accelerate growth. But these newer wells peter out more quickly, so companies have to drill new ones sooner to sustain their production.
In effect, frackers have jumped on a treadmill and ratcheted up the speed, becoming ever more dependent on new capital to keep oil production humming, even as Wall Street is becoming more skeptical of funding the industry.”
”Gas production in the two largest U.S. oil fields, in Texas and North Dakota, grew 43% from January 2018 to the same period this year as oil output grew 35%, according to EIA data. There isn’t enough pipeline capacity to bring all of that fuel to market, so companies in West Texas effectively have had to pay people to take it away. Prices at the Waha trading hub fell to a record average low of negative $5.25 per million British thermal units for gas that flowed on Thursday, with some gas sold for as little as negative $9, according to S&P Global Platts.”