"Drill Baby Drill" is unlikely to happen

[dan_s]

As of August 16th, the active drilling rig count in the U.S. was 586, 56 lower than where it was a year ago.
I believe that Trump's plan to "Drill Baby Drill" to lower oil prices is unlikely to happen if he is elected.
> Public upstream oil & gas companies are not going to ramp up drilling programs unless oil & gas prices go higher.
> Our federal government does not own or control upstream companies (Thank God).
> The upstream companies in our three model portfolios are free cash flow positive and they want to remain that way.
> Trump might open more federal lands to exploration, but that will take years to add more production.
> Tax incentives to convert more trucks to run on natural gas could lower the price of diesel, which would lower food prices.

Comments below are from a note that I received this morning from Keith Kohl (The Energy Investor):

The real value will be in the technology being utilized to both lower cost and boost drilling efficiency.
Let me show you what I mean…

Today, companies take advantage of a technique called simulfrac, or simultaneous fracturing, which means the operator can fracture several different sections of a well at the same time. By doing so, a company can reduce the time it takes on completing the well.

In the Permian Basin, a company called Ovintiv (NYSE: OVV) is employing what they call trimulfrac to complete three wells at a time, and is already seeing impressive results.

This kind of technology is how the U.S. oil output will grow going forward.
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Another new drilling technology that will lower completed well costs is being used to drill "Horseshoe" wells. Several of our Sweet 16 companies are reporting Horseshoe well costs that are 15% lower per lateral foot.