Shale companies in the US have already started “exit game”. As the newspaper writes The Wall Street Journal, Texland Petroleum, based in Fort worth (TX), stopped oil production at all of its 1,21 thousand wells until the beginning of may.
The company had to do it because of the complete lack of orders for hydrocarbons. “We never did so, – the newspaper quotes words of the President of Texland Jim Wilkes. – We have always been able to sell oil even at a lousy price.”
He informed the controller of the state of Texas about the decision to get permission to receive funds appropriated by the US administration to support small and medium-sized enterprises suffering losses due to the impact of the pandemic coronavirus. Lifting will help to pay the salaries of 73 employees Texland during the downtime.
And Texland just the first step. Continental Resources, developing mineral resources in the States of Oklahoma and North Dakota, will reduce production by about 30% in April and may of this year. Parsley Energy (West Texas) stopped working about 150 wells. As reported by the newspaper, the head of the Parsley Matt Gallagher, proceeds from the sale of raw materials was lower than the cost of equipment operation, costs for electricity and for the right to develop the subsoil.
The Wall Street Journal explains the difficult situation of us oil companies, low prices for hydrocarbon raw materials in the world, the price war between the leading manufacturers and the impact of the pandemic of the novel coronavirus.
Oil the United States is ready to agree with the national audit office
The situation was commented by a member of the Texas railroad Commission (Texas Railroad Commission regulates the oil industry in the state) Ryan Sitton. “I don’t advocated the introduction of proportional distribution of production in Texas, I advocated that we consider this idea. I felt that we must be open to assess any ways that will help to unite the international oil community in a global agreement,” said the Commissioner.
“While I have publicly expressed my thoughts on what Texas should take the lead in this conversation, I still have many doubts, and I will carefully examine the question of whether and how to regulate production,” — said Sitton.
“None of us like the idea of state control over private enterprises. But we also recognize that these unprecedented times require us to consider all options to ensure stability in the industry that we regulate,” — said the Commissioner.
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