[thackney]

Shakeout threatens shale patch as frackers go for broke
http://fuelfix.com/blog/2014/05/27/shakeout-threatens-shale-patch-as-frackers-go-for-broke/

...Shale debt has almost doubled over the last four years while revenue has gained just 5.6 percent, according to a Bloomberg News analysis of 61 shale drillers. A dozen of those wildcatters are spending at least 10 percent of their sales on interest compared with Exxon Mobil Corp.’s 0.1 percent.

...Drillers are caught in a bind. They must keep borrowing to pay for exploration needed to offset the steep production declines typical of shale wells. At the same time, investors have been pushing companies to cut back. Spending tumbled at 26 of the 61 firms examined. For companies that can’t afford to keep drilling, less oil coming out means less money coming in, accelerating the financial tailspin.

[biff]

Old time pilots call this “getting behind the power curve”.

[catfish1957]

I am betting technological advances in NG processing will allow refining facilities to make almost any hydrocarbon product with little or no crude. Exciting times ahead, and great investment opportunities for those who latch on to the right players.

It is common knowledge that the low hanging fruit of easy oil is gradually disappearing, thus precipitating the production drops. Those who won't adapt, won't survive.