East Texas Haynesville drilling program ceases immediately in the middle of their first pad. Doubtful to return, will likely transact. Anybody else in the corp dealing with capital cuts due to projected overspend? Just curious where all we are cutting back besides MCBU.
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GOM future project just got a lot smaller. Sounds like they are getting ready for the axe man to come ……… or …….. to buy another company soon………or both. We are over staffed and we don’t have any future projects past a few years.
We should just farm this out to companies who can actually operate in the Haynesville and know how to make money. We’ve done the farm outs in the past. We don’t hedge our gas and we spend 4 times as much building pads and drilling wells as other companies in the area and the list goes on. By the time we decide to move and mobilize and actually get a pad built and a rig drilling the price of gas falls again.
Yes Indeed. Let the Axeman cometh and take care of this mess that has been made.
Chop Chop!
We definitely need to start cutting out a lot of the deadwood if we expect to make any progress at this point.
If they are just deferring completions and not dropping rigs then should be no issues. If it’s both then may want to polish off the CV.
Meanwhile share buybacks going strong
The point being made is that you cut activity (not people) to achieve capex reductions.
Employees working on capital projects are actually capex.
Unless you’re referring to robots, employees are opex. This thread is about capex.
If we only had staff that directly impacted the bottom line maybe we would not
have to cut capital expediture.
Too many no productive people soaking up monies for their pet non energy related projects.
Capital cuts will be made starting right at the bottom of the portfolio and move up until we reach the required number. Sorry for those bottom few deselected in this Squid Game.
We have the capital to do it (there is more than 20 billion in cash sitting on the balance sheet), but we are towing the capital discipline line in that we do not want to exceed our capital guidance to Wall St.
Overspending compared to guidance is perceived to be a bigger issue (macro) than not completing a few wells (micro).
Not about ROI. more about not having the capital to do it. Aside from the $ to complete, still need the capital for the facilities that needed to be built.
Is the ROI that terrible on completing a drilled well??
Just got word this morning that all completion activities are suspended at CBU for the remainder of the year.
The shale assets are profitable for chevron as long as they are oil, the east Texas shale is too expensive to drill and too gas, so it will be not a good fit for Chevron, same as AMBU, the market and margins are not there to support it. With oil prices trending down and WTI is hovery around $70 and not projected to go above $80, any investment in US gas field is doomed.
We have had the ETX assets for decades. The reason the activity is being stopped is due to capital over spent, not the uality of the asset. Of course it is lower in quality compared to Permian, but still valuable.
No surprise here. Totally oversold asset by an ambitious ex Exxon employee 4 years ago. If the VP or GM at the time had any subsurface knowledge these assets would have been sold
Never work on marginal assets as they will always get shortshrift and so may you.
You probably blew your load on wellsafe