• The U.S. now produces approx. 12MM BPD and this is expected to grow to somewhere between 17MM and 20MM in the next five years.
• This growth may serve to drive down oil and gas prices, thus affecting the economics of shale production.
• The market cap for S&P500 energy companies has halved in the last four years. There have been 200+ shale producer bankruptcies in the same period (in particular small and medium-sized companies).
• Wall Street is now attempting to force economic discipline in the industry by requiring better ROCE and a general return of cash to shareholders.