At $45-50 price per barrel of oil, it is clear where the oil companies see their most cost efficient operations and highest yields from exploration. Of the 943 active drilling rigs this week, 79.9% of all drilling rigs are active in Texas, Colorado, Louisiana, Oklahoma. Texas and Oklahoma represent over 62% of total drilling rigs active in the United States and nearly 78% of all drilling rig activity of the four most active states.
So, the question is why are these states the most active in exploration?
Access to supplies
Access to personnel
Access to management
Access to money
Multiple targets in developing basins
Proven and long lived historical production records for more favorable financing terms
Easier liquidity upon disposition or aggregation
Low-risk exploration parameters
Ingress and egress infrastructure
Closest regional plays to the refineries and water
Lowest cost shale wells to drill
Highest recovery of reserves comparatively speaking
Most mature and savvy mineral owners
Most accessible water sourcing
Most environmentally friendly states to explore
Largest concentration of privately held mineral leases
Most pro-active hydrocarbon states in the union
Highest # of days for work, production and operations
Most favorable weather patterns for continuation of exploration
Eckard Enterprises will explore these topics every week until all subjects and their points are discussed. Stay tuned for next Friday’s first two subjects delineated and explained.
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