Americans are feeling the slowdown in the economy, and many are a bit fearful of what is to come. Unfortunately, these misgivings are not misplaced. In fact, for the general population, there is arguably less anxiety right now than the situation warrants. In the interest of gauging the seriousness of the situation, it would be advantageous to take a look at some of the things going on in our industry. Some of the recent news has not been positive. Businesses are cinching their belts in anticipation of a prolonged recession, and a lot of “guaranteed” projects that have been on the books for months could be shelved. The following news bites give a little more insight into the big picture. Oct 22 - Baker Hughes Inc. said it expects about 200 drilling rigs in North America will be idle in 4Q 2008 because of the tighter credit markets and the declines in oil and gas prices. Oct. 23 - Suncor Energy announced it would delay construction of an oil sands upgrader for the C$20.6 billion Voyageur expansion by one year to 2013. Oct. 23 - Nexen Inc. and Opti Canada delayed a decision on the second phase of the Long Lake oil sands project to sometime in 2009. Expansion would double production of synthetic crude to 120,000 b/d. The first phase, which cost C$6.1 billion, is now just starting up. Oct. 24 - Newfield Exploration Co. announced it will cut back 2009 spending by 21% and that it has trimmed its production outlook for 2009. The company expects to spend $1.65 billion, down from its previous estimate of $2.1 billion. Newfield reports it is “matching its capital budget with cash flow expectations.” Oct. 24 - Jim Mulva, CEO of ConocoPhillips, said the company will keep its 2009 capital spending plan flat at its 2008 level of $15 billion, adding “We want to live within our means.” In an Internet broadcast, Mulva said that as the company moves forward, the primary goal is to maintain a strong financial balance sheet position with flexibility and credit capability. “Second,” he said, “we want to fund those capital commitments and opportunities we have as a company.” Oct. 24 - Steve Farris, CEO of Apache Corp. said the company plans to spend about $1.2 billion on exploration projects in the coming year. During a conference call with analysts, Farris said Apache will operate its business within its cash flow. The company plans to start looking at assets to buy, he added, saying the “economic reality is a lot better today than it was four or five months ago.” Companies that previously cut 2009 spending plans include Chesapeake Energy Corp., Petrohawk Energy Corp., SandRidge Energy Inc., and ATP Oil & Gas Corp. Others are joining this list daily. The many predictions that painted a rosy picture of our industry through 2012 are being revised in light of the present economic climate. That climate is changing, and it will have a volatile effect on investment and project execution in both the near and long term.