Upshot of the March 9 markets meltdown for the U.S. shale industry? Survival of the fittest.
“We already had a number of U.S. shale producers that were very challenged because they didn’t have great balance sheets and were struggling,” Pearce W. Hammond, managing director for midstream equity research at Simmons Energy, told HartEnergy.com. “This just accelerates this process. It likely means several companies will go bankrupt.”
Michael Hurst, an oil and gas litigator and partner with Lynn Pinker Cox & Hurst LLP law firm in Dallas, sees it, too.
“I think it will be early in the second quarter where we will see companies that are holding on for dear life and finally letting go,” he said. “As much as we’d like to say this will be over in a matter of a few weeks, it doesn’t look like that’s going to happen."