The Word From Texas, Oklahoma

The Federal Reserve Banks in Kansas City (which includes Oklahoma) and Dallas issued a survey to oil and gas entities on their moods, expectations and general sentiments on everything oil-or gas-related.
By The Bakken Magazine Staff | December 20, 2016

The Federal Reserve Banks in Kansas City (which includes Oklahoma) and Dallas issued a survey to oil and gas entities on their moods, expectations and general sentiments on everything oil-or gas-related, ranging from prices needed for drilling to job demand. 

For the first time in two years, respondents in Oklahoma reported rising business activity and revenues. In Dallas, operator participants as well as service providers, said they were bullish on industry activity for 2017. But, that’s not all each group had to say on their respective regions. 

 

Oklahoma
Price needed for drilling and well completion activities to rise: $53/b.

Q3 2017: The date when global oil inventories will balance.

“We expect a significant increase in 2017 capital spending as long as we have access to debt and equity markets at rates justifying accretive returns,” a respondent said.

“We need to replace reserves in order to maintain our borrowing base,” another survey participant said.

 

Texas
62 percent of all respondents expect oil prices to rise in 2017.

Price needed for drilling and completion activity to increase: $50/b to $55/b.

Main challenges to ramping up: worker shortages and access to capital

“There is paralysis from analysis that prevents rational deployment of capital,” the survey respondent added.

“Service cost inflation will have to happen, but it will also serve to help support price increases as service capacity will be unable to keep pace with demand increases.”