From Bloomberg comes another sobering report on how expensive it actually is to mine ro extract oil in the USA.
Independent oil producers will spend $1.50 drilling this year for every dollar they get back.
Even with crude above $100 a barrel, shale producers are spending money faster than they make it.
For each shale well, Chesapeake will spend an average of $6.4 million (per well) this year.
Sanchez Energy Corp. plans to spend as much as $600 million this year, almost double its estimated 2013 revenue, on the Eagle Ford shale formation in south Texas.
The output of shale wells drops faster (than conventional wells), falling by 60 to 70 percent in the first year alone!
(Can you imagine if your business revenue dropped as fast?)
Read the whole story here: