PXD's Sheffield sees U.S. oil production slowing

[dan_s]

HOUSTON (Reuters) - Pioneer Natural Resources Chief Executive Scott Sheffield said on Tuesday that he expects the Permian Basin, the top U.S. shale field, to “slow down significantly over the next several years.”

“I don’t think OPEC has to worry that much more about U.S. shale growth long term,” Sheffield said on Tuesday on a call with analysts.

U.S. shale fields have driven domestic production to all time highs, prompting OPEC to cut production to keep global prices stable. But U.S. producers are under pressure to trim spending and return profits to shareholders through dividends and share buybacks.

Despite new production coming from Norway, Brazil and Guyana in the next year, “there’s not much coming on after” that, Sheffield said, adding that he is “becoming more optimistic that we’re probably at the bottom end of the cycle” in oil prices.
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MY TAKE:
> It doesn't take an MBA to figure out that the BIG DECLINE in the active drilling rig count will cause U.S. production to fall.
> I hope you all read the G&R report that we sent to all members yesterday. Every oilfield ever discovered eventually runs out of Tier One drilling locations. Think of each shale play as a new oilfield made possible by horizontal drilling technology. The Permian Basin is the only U.S. shale play with significant upside.
> Non-OPEC/Non-US oil production will be up a bit in 2020, but not as much as the NYT forecast.
> Sub-$55 WTI is an unsustainable oil price and soon Sub-$60 WTI will be unsustainable. Attend our Houston luncheon on November 13 to learn why.