TROUBLE FINANCING ITS DEBT: Massive Decline Rates Push U.S. Shale Oil Industry Closer Towards Bankruptcy

Friday, August 25, 2017
By Paul Martin

By: Steve St. Angelo
Friday, 25 August 2017

The U.S. Shale Oil Industry is in serious trouble as its debt spirals higher due to its massive production decline rates. While the Mainstream media continues to put out hype that the shale oil industry can produce oil at $30 or $40 a barrel, the reality shows that it’s becoming difficult just to finance its debt.

Yes, it’s true. Many of the shale oil companies are bringing on new wells just to pay the interest on their debt. Now, this wasn’t the case back in 2008 when the U.S. Shale Oil Industry first took off as most of the shale energy companies held very little debt and paid a tiny percentage of their operating income to finance its debt.

For example, Continental Resources who labels itself as “America’s Oil Champion” is one of the larger shale oil producers in the Bakken Shale Oil Field in North Dakota. Before Continental Resources started to pour money into the Bakken, its total debt was $165 million, and its annual interest expense was a paltry $13 million in 2007:.

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