Posted on 11/17/2014 7:53:25 AM PST by deport
In a deal that shows just how quickly falling prices can upend the energy industry, Halliburton
is buying rival oilfield services company Baker Hughes in a cash-and-stock deal worth $34.6 billion.
(Excerpt) Read more at beaumontenterprise.com ...
The purported “objective” of this (big oil price fall primarily via Saudis) was/is to put the squeeze on the Russians over the Ukraine but the little side benefit to the greenies and demonrats is going to be the crushing (as has been done before) of the investment/capital structure of oil exploration and production in the US in this cycle...
On the positive side, there’s probably been enough wells put in that it will only be a matter of turning them on so to speak when the price begins rising.
On the positive side, there’s probably been enough wells put in that it will
only be a matter of turning them on so to speak when the price begins rising.
*************
I’m sure there are lots of shut in wells that can be brought online as needed.
The decline curve for shale wells is very steep. If they stop drilling New wells the abundant supply of hydrocarbons will disappear pretty fast.
Really, you believe we spend the large expense of putting a well in service then don't want the cash flow?
If they don't keep flowing oil/gas, most lease terms require they lose the lease.
And now we have a duopoly in oilfield services.
Halliburton and Schlumberger.
I’m sure the two will be very competitive and drive prices down.
Wow!
The Beaumont Enterprise as a source of news.
Thought I would never see the day.
Unless of course one of team Obama outdoes themselves, as happens here with regularity.
Really, you believe we spend the large expense of putting a well
in service then don’t want the cash flow?
******************
Nope don’t believe that at all.
Who eats who first?
Schlumberger or Halliburton?
Thought I would never see the day.
***************
LOL.......
I’m sure there are lots of shut in wells that can be brought online as needed.
What is the source of these shut in well? Old strippers that produced less that 2 barrels a day?
That is what I said but not what I meant. I meant if they had to shut wells in then with
some work maybe they could be placed back in service.
Most of the cost is up front. It takes a lot lower price than this to take any significant amount of wells out of production.
Schlumberger or Halliburton?
- - - -
I don’t see that happening. But then I would have said the same a week ago about Halli / B.H.
Analysts say the two will have significant antitrust hurdles to deal with, and will likely have to spin off, sell or divest in part of their businesses including well cementing, logging-while-drilling tools that capture subterranean data, and engines that control the direction of underground drilling paths. That will almost certainly result in job cuts.
Halliburton said it agreed to divest businesses that make up to $7.5 billion in revenue if antitrust authorities require it, but it said it expects that amount to be significantly less. It also agreed to pay Baker Hughes a $3.5 billion break-up fee if the deal falls through.
Halliburton and Baker Hughes, the second and third biggest oil field service companies in the world, have 15,000 employees in Houston and 136,000 around the world. They said the combination would result in $2 billion in cost savings and revenue increases. Combined 2013 revenues were $51.8 billion.
http://fuelfix.com/blog/2014/11/17/halliburton-to-buy-baker-hughes-for-34-6-billion/
Two fine companies...both started by men of vision!
At a certain price level producing, installed wells will just be turned off unless the owner is desperate to make payments on financing of same.
I believe the oil quality is pretty good for these though. Places like Venezuela are hating life now, their oil is crap, and unless oil is over 90 plus something a barrel, no one wants to run it through their refineries.
Is it a misconception that every section of horizontal is not initially fraced, which would leave other sections available for another frac when production ramp-up is needed?
Smokin' Joe can correct me where I am wrong here. I doubt hardly any invest in drilling a lateral that they don't intend to initial produce. Cheaper to complete the frac while everything is set up prior to the production I would think.
Most producers want all the oil they can get as soon as they can get it. Cash flow is King in an expensive shale field. There are limits to the flow rate to prevent damage to the reservoir, but you are talking about something else.
I know of times where different layers are produced at a different time period, even owned by different companies and one may produce before the other. But I don't remember a production lateral drilled out in those cases for future production.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.