Another Cowboy reported today - DVN. They are highly diversified so I'll just reflect on just the areas of Cowboyistan they operate in - EFS & Permian.
Seems like DVN doesn't give a #@$ about SA and driving the oil price down. In the EFS alone they are forecasting to spend $1.1B drilling 225 wells ( running an avg of 11.5 rigs). The future looks rosy to them. The EUR's are up the IPs are up, costs coming down, Cash Margin of $51/Boe. Life looks good over at DVN they are forecast 50% growth for 2015 over 2014 (from 2014 avg of 65Mboepd to >100Mboepd).
But wait, they avg'ed Q4'14 at about 98Mboepd .... so that it a little "enthusiastic" shall we say. Bullish outlook also for the Permian.
Overall the message is 20% less capex for 20% oil production growth. Hmmmm
So it seems well productivity is key - as it costs but also as in recovery (rates and EUR). Also seems like high grading of well locations.
But this would be bucking the desired effect - force oil price down thus forcing rig lay downs, less capex spend and ultimately less production.
More of this type of company reporting and the oil price would need to stay low for longer for SA to achieve the desired effect (assuming that was at least part of the objective). Divergent report relatively speaking than PXD & APA. We'll see what CLE & EOG say soon.
When is a SSN ops advisory due? Has to be soon with that much well progress to advise.
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