Obstacle: Capital Discipline
Costs may rise more than capex in 2001, actually reducing drilling activity.
“Lord, just give me one more oil boom…
- Combined oil/gas price at record level
- 2001 upstream cash flow for industry estimated to be at least equal to 2000
I promise I won’t screw this one up.”
- 2001 budgets show industry increasing E&P capex by only 20%
- Costs are up by an estimated 25-35%