Majors dig deeper into the Permian, possibly raising costs for independents

摘要

Before the turn of the century, many majors assumed the Permian would dry up quickly, making room for smaller independent producers to lead the charge in the shale play. Now that these independents have experienced some operational success, their shareholders are demanding higher returns, so many of these companies have decided to reduce spending in order to increase dividends. The combination of diis shift and the notion that Permian production will last for many years has led the majors to move in with greater vigor. Drillinginfo Inc. Analyst Andrew Dittmar reports these larger firms are often able to negotiate better terms with oilfield service companies. Wood Mackenzie Analyst Roy Martin suggests smaller companies with less negotiating power will be left paying higher prices for service contracts.