Shale explorers pump oil on the cheap from slumbering US wells

Chicago

US shale explorers will be able to bring new supply to market this year even with most of the rig fleet idled and drilling budgets cut to the bone. Their secret: thousands of mothballed wells.

Companies from Exxon Mobil Corp to EOG Resources Inc have 3,994 wells drilled between Jan 1, 2014, and Aug 31 with active permits that had not been completed as at Dec 18, according to William Foiles and Andrew Cosgrove, analysts at Bloomberg Intelligence.

The fracklog, as the cache of suspended wells stretching from south Texas to the Rocky Mountains is known, is growing as the worst crude-market downturn in a generation spurred them to halt projects early to conserve cash. Global oil markets are in turmoil amid a market-share war between Opec (Organization of the Petroleum Exporting Countries) and American shale explorers that has created a flood of excess supply and slashed the value …