How can a producing well loose money?
Once the well is producing, there is little direct cost associated with it. Almost all of its output would contribute to cash flow.
“How can a producing well loose money?”
Expected cash flow will shrink, thereby shrinking expected profits, hence the value of the company.
In simple terms, there are many costs associated with an oil well, items such as Acquisition Costs, Exploration Costs, Development Costs, and Production Costs, Maintenance and Transportation costs. Some of these costs are expensed or capitalized. Producers also pay royalties to the land owners.
When the combined costs exceed the sale price, you shut the well. I don't know the specifics of his wells.