WSJ - Fracked Wells Not Measuring Up; Review Of 29 Drilling Cos - $112 Billion In Losses In 10 Years

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“Two-thirds of projections made by the fracking companies between 2014 and 2017 in America’s four hottest drilling regions appear to have been overly optimistic, according to the analysis of some 16,000 wells operated by 29 of the biggest producers in oil basins in Texas and North Dakota,” it reported. “Collectively, the companies that made projections are on track to pump nearly 10 percent less oil and gas than they forecast for those areas, according to the analysis of data from Rystad Energy AS, an energy consulting firm.” “That is the equivalent of almost one billion barrels of oil and gas over 30 years,” the Journal added, “worth more than $30 billion at current prices.”

The problems the Journal focused on will be familiar to those who’ve turned a critical eye to shale reserves in the past: The most productive areas, or “sweet spots,” are smaller than first expected and companies predicted that wells would dry up slower than they have. DeSmog launched its latest series covering shale's financial woes in April 2018 and our coverage extends back over a half-decade.

For the Journal, the take-aways were financial. “So far, investors have largely lost money,” the newspaper pointed out, adding that a review of 29 drillers showed companies have spent $112 billion more than they earned from drilling in the past decade. “Since 2008, an index of U.S. oil and gas companies has fallen 43 percent, while the S&P 500 index has more than doubled in that time, including dividends.”

The industry’s defenders argue that spending money now to make money later is simply how business works — this year’s “losses” are actually investments in future profits. But because shale drilling is relatively new, even the experts are left guessing about how much oil will be flowing from the wells 10, 20, or 30 years after fracking — and investors have become frustrated as shale drillers have largely failed to turn the corner and start racking up profits instead of continuing to operate in the red.

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https://www.desmogblog.com/2019/01/10/fracking-shale-oil-wells-drying-faster-predicted-wall-street-journal