Publications

- June 1, 2015: Vol. 2, Number 6

To read this full article you need to be subscribed to Real Assets Adviser

Fracked Again: With oil prices half of what they used to be, energy companies turn to ‘refracking’ to maintain a profit margin

by Carl Larry

We are in a strange new place in oil drilling, and we all can take a guess that I am talking about fracking. This is a good start, but as quickly as we have come to understand “fracking” or horizontal drilling, we are already seeing changes in this drilling method.

To review quickly, horizontal drilling and the ideas behind fracking have been around for some time (1970s). But as oil goes, people look for the most economical way to get oil and gas from the ground to the masses. Technology supported vertical drilling wells and the costs associated with them were the most efficient for the economy. However, around 2011 oil prices were averaging well over $80 per barrel in America and our demand was low enough to explore other options. The availability of money to be spent on domestic exploration prompted more to venture out into newer and less expensive methods. Here is where the fracking boom started.

From 2011 to 2014, U.S. crude oil production had grown from about

Forgot your username or password?