The news for Beach Energy and Icon Energy during the week ending 27 Feb 2015 was not particularly uplifting. Chevron added Australia to its list of countries where it has withdrawn from shale plays. The “opportunity does not align strategically with Chevron’s global exploration and development portfolio,” according to a Beach press release.

Chevron Exploration Australia 1 Pty Ltd will not participate in Stage 2 of the Nappamerri Trough Natural Gas (NTNG) Project. The good news for Beach and Icon is that Chevron informed the companies “that extensive technical evaluation has confirmed a large gas resource and potential for further appraisal.”

It’s not much fun when a major source of revenue is lost. It will impact Beach’s strategy in fiscal years 2015 and 2016 with minimal spend expected during that time. Beach will be looking for a new partner.

At the same time, what can a company do with minimal spend? In the U.S. shale plays, many companies will fall back on new technology, application of optimised well planning and cost reductions to make the most of the money that is available.

Barclays Equity Research evaluates the activity of U.S. companies, including strategies those companies are using to ride out the downturn in oil prices. For example, on 26 Feb, SandRidge Energy said it reduced its 2015 capital budget significantly with total spending expected to be more than half of what it was in 2014. The company is active in the Mississippi Lime play in Oklahoma and will cut it number of operated rigs from 32 at the start of 2015 to seven by the middle of the year. The company will employ more multilateral development to drive down costs. It is aiming for cost reductions of 20 per cent per lateral by the second half 2015.

Barclays noted that QEP Resources will continue to focus on oil development in its Bakken, Permian and Pinedale assets. Even with a forecast decline of 10 per cent to 15 per cent decline in oil production, “upside surprises could come as a result of enhanced completions in the Bakken—recent wells have delivered 90-day production rates 50 per cent to 60 per cent better than the older design.”

Concho Resources outlined its strategy for 2015, including continued design optimisation and down-spacing tests in the northern Delaware Basin, optimising well spacing and completion designs in the southern Delaware Basin, increasing lateral lengths, working on spacing and well design in the Midland Basin and focusing on lowering costs and maintaining liquidity, according to Barclays.

Concho plans to have 26 rigs running on average in 2015, down from 40 rigs at the end of 2014. The company expects to start ramping activity back up later in the year, as service costs fall. It estimates a cost reduction of 10 per cent to 15 per cent. In the northern Delaware Basin, upsized fracture stimulations continue to boost returns as well, Barclays explained.

Continental Resources will defer 25 per cent of its first quarter 2015 Bakken completions. “The company expects higher prices and lower service costs to lead to improving returns. It has already achieved 10 per cent service cost savings and the 2015 budget assumes a 15 per cent average service cost reduction. Continental continues to see 30 per cent to 45 per cent cumulative 90-day production uplift from its enhanced completions and expects a 25 per cent to 30 per cent estimated ultimate recovery uplift. Barclays stated.

Continental also plans to drill extended laterals in more than 85 per cent of its South Central Oklahoma Oil Play Woodford wells and 50 per cent of its Springer wells, Barclays added.

Devon Energy has already achieved 10-per cent reductions in several key areas and is optimistic it can drive costs down by another 10 per cent to 15 per cent by the end of the year, Barclays reported.

As someone told me while I was growing up on our dairy farm in Oklahoma, every little bit helps. Learning how these companies are cutting costs and enhancing completions can make a difference for your company during this downturn. If you can avoid spending money to learn the same lessons, the industry, as a whole, benefits.

As Beach managing director Rob Cole said, “We look forward to progressing the NTNG project at a pace consistent with prevailing market conditions.” If enough cost cutting information is shared, maybe the company can be at a pace ahead of the market conditions.