Energy Prospectus

Couple of charts here as part of an interesting article.
First is the decline rates of the major shale fields in the U.S.
Not a pretty site.
It's a treadmill for a company to keep increasing production. Of course that's true for any oilco but in the shale it goes double --or triple.
Second chart is the free cash flow of the major shale players.
Only 3 have free cash flow. Some are close but not there yet.
Interesting those top 2, CLR and EOG, do not hedge. Their bet is oil keeps going up.
I agree.

https://srsroccoreport.com/top-u-s-shal ... s-per-day/

Excellent Post. Please keep posting stuff like this. It increases the value of the Forum.

CLR, EOG and CDEV are the only Sweet 16 companies that are unhedged and getting the full benefit of higher prices. Also, since CLR is not in Permian Basin it is not exposed to the large oil price discounts there.

Keep in mind that "Free Cash Flow From Operations" (cash flow in excess of capex spending) is just one way to look at a company. Outspending operating cash flow (PXD) is fine if the companies are rapidly building production and proven reserves. This is especially true in the areas with "Stacked Pay Zones" because the completed wells hold even more 2P and 3P reserves. Leasehold that is Held By Production ("HBP") is worth a heck of a lot more than leasehold that is running out of time. This is why I label some of my Top Picks as "Aggressive Growth" companies.

Any company can maximize Free Cash Flow just by stopping all drilling & completion spending. Of course their production and proven reserves will immediately go on steady decline.