Three Cs for success in shale plays ///

The shale oil E&P sector is entering the second year of low crude oil prices. From a recent peak of $105.79/bbl in June 2014, WTI price slipped all the way down to $47.22/bbl in just six months. After a brief climb up to $59.82/bbl in June 2015, the price dropped again to $45.48/bbl by September 2015. After a winter spike to $6/Mcf in February 2014, natural gas prices at the Henry Hub have languished around $2.60/Mcf, trading as low as $1.90/Mcf in late October. In a keynote address at the Louisiana Gulf Coast Exposition (LAGCOE), Chesapeake Energy CEO Doug Lawler revealed that his company needs a break-even oil price of $50/bbl, and a natural gas break-even price of $2.50/Mcf. Under these dire circumstances, shale operators have to depend upon “three Cs” to remain viable: cost containment, G&G constraint and technology collaboration.

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