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texag7
USA Fan
College Station
Member since Apr 2014
29981 posts

re: Big baws move to dominate Permian
We are Sandbox bitch


redstick13
Detroit Mercy Fan
Houston
Member since Feb 2007
30979 posts

re: Big baws move to dominate Permian
Good luck man. The latest news out today about China doesn't sound promising for the oil business.


El Segundo Guy
USA Fan
90245
Member since Aug 2014
2634 posts
 Online 

re: Big baws move to dominate Permian
I hear you. Everyone is on board to sell but it will probably take 2 months to be able t get it cleared.

Either way it's all good. We weren't even aware of it until 2 months ago.


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Gray12
LSU Fan
Great State of Texas
Member since Apr 2018
480 posts

re: Big baws move to dominate Permian
Offshore is picking up right now. Russians have increased their offshore activities so have we and the Mexicans in the GOM.

In the next 5 years, oil prices will shoot up to $150. Nobody has done real exploration work in the last decade.


castorinho
Oklahoma Fan
13623 posts
Member since Nov 2010
70480 posts
 Online 

re: Big baws move to dominate Permian
quote:

In the next 5 years, oil prices will shoot up to $150.
oh, really?


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80
redstick13
Detroit Mercy Fan
Houston
Member since Feb 2007
30979 posts

re: Big baws move to dominate Permian
You don’t need to do exploration when literally every hole you punch is a producer.


Mr Clean
LA-Lafayette Fan
Dallas/Culiacan
Member since Aug 2006
43169 posts

re: Big baws move to dominate Permian
quote:

I'm disappointed this isn't about Friday Night Lights.


I thought it was about Midland Lee’s offensive line


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Kentucker
Kentucky Fan
Cincinnati, KY
Member since Apr 2013
16029 posts

re: Big baws move to dominate Permian


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100
Gray12
LSU Fan
Great State of Texas
Member since Apr 2018
480 posts

re: Big baws move to dominate Permian
That’s true for the Permian but most companies are sinking because of horrible decline rates and not enough well spacing.

It takes about 3.5 mill to drill and another 4 mill for a 60 stage frack job. That’s 7.5 million, but you also have to pay to lease the acreage. An Acre can go up to $90,000 right now.

Let’s say 8 million dollars in Cost for 1 well.

You produce an average 6000 barrels per day your first 30 days. After 30 days, you are making around 500-600 barrels per day for the rest of your first year. At the end of that first year, you are now getting 80% water.

You get about 10-12 million in revenue after your first year but don’t forget that you have royalties to pay.

You are not making more than 12 million on 1 well after a few years of production for yourself. You still made 4 million in profit but that’s not enough to fund another well. Hence you have to ask for more investment. Therefore, you have no positive cash flow.


Offshore, your well will cost you at least 60 million dollars, but you are easily getting 10,000 barrels of oil a day on average for a few years. Exponentially higher investment but if your wells are good, you are going to make billions in revenue if you have 15-30 good producing offshore wells.
This post was edited on 8/6 at 7:42 pm


mofungoo
LSU Fan
Baton Rouge
Member since Nov 2012
4583 posts

re: Big baws move to dominate Permian
Drill, baby, drill.


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71
DeCat ODahouse
LSU Fan
Premium Member
Member since Jan 2017
527 posts
 Online 

re: Big baws move to dominate Permian
quote:

We are Sandbox bitch


Make that 250 million dollar Sandbox, bitch!


dinosaur
LSU Fan
Louisiana
Member since Aug 2007
937 posts

re: Big baws move to dominate Permian
Exxon bought XTO Sorry didn’t read the next few posts
This post was edited on 8/6 at 8:10 pm


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redstick13
Detroit Mercy Fan
Houston
Member since Feb 2007
30979 posts

re: Big baws move to dominate Permian
quote:

but you are easily getting 10,000 barrels of oil a day on average for a few years.


Not many offshore wells produce 10,000 bbl/day and the costs to bring that production to a refinery are exponentially higher. WTI $ per bbl is the same for offshore as it is for land.
This post was edited on 8/6 at 8:23 pm


GREENHEAD22
LSU Fan
Member since Nov 2009
14401 posts

re: Big baws move to dominate Permian
Yea and even though rig and service rates have come way down 60M is not going to cover a DW well.


GoldenD
LSU Fan
Houston
Member since Jan 2015
884 posts

re: Big baws move to dominate Permian
Wells are drilled under $60MM in the GOM are certainly possible, especially if you look at TLP type facilities with low burn rates. Granted, there is a huge initial infrastructure cost to start.


dkreller
LSU Fan
Not Offshore
Member since Jan 2009
25897 posts

re: Big baws move to dominate Permian
quote:

was thier gameplan all along. Let the independents do all the leg work and find the sweet spots. Run themselves broke trying to keep their stock prices up then the majors will sweep them up on the cheap.

And use their market share to drive up oil prices

Winning


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dkreller
LSU Fan
Not Offshore
Member since Jan 2009
25897 posts

re: Big baws move to dominate Permian
quote:

Wells are drilled under $60MM in the GOM are certainly possible, especially if you look at TLP type facilities with low burn rates. Granted, there is a huge initial infrastructure cost to start.

Still have to complete them baw


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redstick13
Detroit Mercy Fan
Houston
Member since Feb 2007
30979 posts

re: Big baws move to dominate Permian
They are. In fact Shell has been drilling reentry wells on Auger this year but those wells are not touching 10,000 bbl/day. The guy he was responding to was mentioning exploration. Exploration wells have none of the infrastructure in place to bring any potential discoveries to production. That involves an enormous investment and years to bring online.


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40
elsu
LSU Fan
H-town
Member since Aug 2004
939 posts

re: Big baws move to dominate Permian
quote:

Nobody has done real exploration work in the last decade.


What about Guyana? XOM and Hess will be rolling in the cash in a year or 2


Gray12
LSU Fan
Great State of Texas
Member since Apr 2018
480 posts

re: Big baws move to dominate Permian
Exploration for Exxon Mobil in Guyana began in 2008.

They knew all along but only announced in 2015. It’s looking really good for them. About 300 ft. Thick high quality sandstones that contain more than 700 million barrels of oil.


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