The Terrible Oil News Nobody Noticed…”And it will cause the Banks to Tighten the Noose.”
by Matt Badiali
WolfStreet.com
March 17, 2016
A terrible bit of news went unnoticed in the commotion amid the modest rebound in oil prices over the past two weeks. While every news outlet shouted about Iran and OPEC, a U.S. energy icon quietly announced news that could potentially shatter the industry.
As I’ve explained recently, many oil companies are teetering on the brink of bankruptcy. But news out of Alaska could lead to disaster.
BP Prudhoe Bay Royalty Trust (BPT) – operated by the Alaskan division of oil giant British Petroleum (BP) – sells oil from the Prudhoe Bay oilfield.
It just announced a 65% drop in its economic oil reserves.
We’ll explain exactly what that means in a moment, but you can expect the numbers that the other area shale explorers release in the coming weeks will be even worse.
From 1968 to 2015, Prudhoe Bay was the most prolific oilfield in the country, according to the U.S. Energy Information Administration (EIA). Today, Prudhoe Bay ranks third in the U.S. behind Texas’ Eagle Ford and Spraberry Shales. Prudhoe was so large, three major oil companies – BP, Arco, and Humble Oil – spent $8 billion in 1977 constructing the Trans-Alaska Pipeline System (TAPS) to bring its oil to market. That’s more than $31 billion in today’s dollars.
The Rest…HERE
