Oil Storm Has Texas Wildcat Veterans Warning Bakken Rookies to Take Cover

By Bradley Olson and Tim Loh Dec 15, 2014 11:45 AM ET

Autry Stephens knows the look and feel of an oil boom going bust, and he’s starting to get ready.

The West Texas wildcatter, 76, has weathered four such cycles in his 52 years draining crude from the Permian basin, still the most prolific U.S. oilfield. Though the collapse in prices since June doesn’t yet have him in a panic, Stephens recognizes the signs of another downturn on the horizon.

And like many bust-hardened veterans in this region -- which has made and broken the fortunes of thousands -- he’s talking about it like a gathering storm. The ups and downs of oil are a way of life in Midland and Odessa, Texas, dating all the way back to the Great Depression. It’s as much a part of the culture as Gulf Coast hurricanes, and residents often prepare accordingly.

Related:

Oil Trades Near 5-Year Low as OPEC Seen Resisting Cuts
U.A.E. Sees OPEC Output Unchanged Even If Oil Drops to $40
The Biggest Winners and Unluckiest Losers of the Oil Crash

“We’re going to hunker down and go into survival mode,” Stephens, founder of Endeavor Energy Resources LP, said in an interview from his Midland office, where visitors are first greeted by a statuette of a Texas Longhorn steer. “Stay alive is our mantra, until the price recovers.”

Go about 1,300 miles (2,100 kilometers) due north and you get a very different take from the rookie oil barons in North Dakota, where crude output from the Bakken formation went from 200,000 barrels a day in 2008 to about 1.2 million today. They’re not seeing any need to take shelter, and it shows in their swagger.

more...

http://www.bloomberg.com/news/2014-12-15/oil-bust-veterans-brace-while-shale-boom-newbies-swagger.html