Insight
Rising risks in Lower 48 opex: marginal impact or deal destroyer?
*Please note that this report only includes an Excel data file if this is indicated in "What's included" below
Report summary
Operating cost (opex) analysis is often only a focus if prices are soft and margins are squeezed. However, early signs of rising opex costs are underway, with some US E&Ps – particularly oil-focused operators – starting to show creep in the cost of doing business via lease operating expense (LOE) figures. Our cost analysis shows that water, power, labor and well workover requirements are the most significant areas of concern. Digital initiatives and consolidation can help manage escalating opex, but not forever. In this insight, we provide a bottom-up approach to understanding the riskier elements of opex inflation and explain how conservative and even traditional model assumptions can be problematic for asset buyers. It’s a real challenge at today’s prices. So, how much more difficult would the situation be if prices fall?
Table of contents
- Executive summary
Tables and charts
This report includes the following images and tables:
What's included
This report contains:
Other reports you may be interested in
Insight
Q4 North America LNG projects update: FERC authorization maintains momentum at Cheniere's Corpus Christi LNG Stage 3
Proposed capacity that is now fully permitted for construction in the United States stands at well over 150 mmtpa
$1,050
Asset Report
Sinochem - Lower 48 upstream
Upstream valuation of Sinochem's assets in the US Lower 48
$22,800
Insight
Framing a record Haynesville deal: digging into the Rockcliff rumor
The Haynesville is the hottest gas play in the US and deal rumors are swirling around one of its biggest producers.
$1,350
