cappycap said:

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Can anyone add commentary if oil field jobs, particularly in South Texas, have started to increase and what you think will be the oil field job activity over next 6 months. Thanks

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My company has added headcount in South Texas recently, but we're not talking much. West Texas and MidCon are the two biggest areas of growth we see moving forward. We've had a hiring surge since November or so. (service company-drilling)

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Most of their work is many year long massive projects that are probably very mature. Possibly most of the engineering work is done, a lot of the manufacturing is done etc. They probably have a YUGE hole in their front end areas like the project guys and the engineering guys.

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Exactly. A significant portion may even be done except for some final invoicing. The other factor is that a lot of companies put a freeze on offshore development projects during the bust that they are just now thinking about returning to. So it's not only that there is nothing that's come in lately but also nothing on the immediate horizon. So if you "buy" the work, you keep your abilities and are ready to go once the rebound happens. That's pretty critical because whoever seizes the front end of build cycle usually carries the momentum through to get the lion's share of the work. No one wants to be first to the market but everyone wants to be second. They also want to use whoever everyone else is using.

That being said it seems like half the time when a salesman loses an order it's because the other guy took it at a loss. Or at least that's the story of the guy that didn't get the order.

*Note - I do not work for OneSubsea nor any of their competitors. Well, not directly a competitor. I'm not really sure all that we do.

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My company has added headcount in South Texas recently, but we're not talking much. West Texas and MidCon are the two biggest areas of growth we see moving forward. We've had a hiring surge since November or so. (service company-drilling)

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When I was working for a service company I was based in the MidCon district. All of my work was in Oklahoma. Drilling out there was long and slow. Had some really good paychecks though.

I'd be surprised to hear they took it at a loss, that is a dangerous precedent to set for a major operator

terradactylexpress said:

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I'd be surprised to hear they took it at a loss, that is a dangerous precedent to set for a major operator

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More dangerous if an operator is dumb enough to get played like that.

Anyone have any thoughts on EP's drilling joint venture in the Permian they announced yesterday afternoon? Their stock shot up 12% during after hours, but was then down 7% today.

I was offered my old position (frac engineer) to go back to midland. Currently have a stable job in construction but I miss the oilfield. What're the prospects for short term and long term job stability? I want to go back but would hate to lose my job again this year.

Short term, I think you should be ok if they're asking you back. Long term, there will be another cycle in 8-12 years when everyone is trying to make as much money as possible. That's just my opinion though, so may not mean much.

Im worried that efficiencies in drilling will make it to where the price of oil has a hard cap on it around 70 unless something weird happens.

like a major war?

Aggielandma12 said:

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like a major war?

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yep, thats one of the "something weird" possibilities. Another is that India/Pakistan/Bangladesh have an economic renaissance and need another 800,000,000 cars over the next decade or so.

Not worried about long term as I can play for that. Just don't want to go back and be laid off in October again...

Aggiebonzo go for it. As long as oil stays in this price range or higher, (which it should) you should be fine. Me personally I think we see $60 oil by the end of the year and continued increases next year.

Sq16Aggie2006 said:

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Im worried that efficiencies in drilling will make it to where the price of oil has a hard cap on it around 70 unless something weird happens.

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why would drilling efficiency drive a cap on the selling price of a barrel? And if it does what does it matter?

Ragoo said:

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Sq16Aggie2006 said:

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Im worried that efficiencies in drilling will make it to where the price of oil has a hard cap on it around 70 unless something weird happens.

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why would drilling efficiency drive a cap on the selling price of a barrel? And if it does what does it matter?

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The efficiencies have lowered the breakeven point for US producers. What has happened in the US drilling market since OPEC announced the cut? The price bounced up and the US and Canada rig count went through the roof, adding 144 rigs since mid November when the cuts were first rumored. This puts downward pressure on the price of oil due to the future supply growth represented by the increased rigs.

Why does it matter? I dont think we'll see those spikes above 100 where people were paid stupid money again, as was mentioned above. Just my two cents.

Sq16Aggie2006 said:

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Ragoo said:

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Sq16Aggie2006 said:

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Im worried that efficiencies in drilling will make it to where the price of oil has a hard cap on it around 70 unless something weird happens.

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why would drilling efficiency drive a cap on the selling price of a barrel? And if it does what does it matter?

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The efficiencies have lowered the breakeven point for US producers. What has happened in the US drilling market since OPEC announced the cut? The price bounced up and the US and Canada rig count went through the roof, adding 144 rigs since mid November when the cuts were first rumored. This puts downward pressure on the price of oil due to the future supply growth represented by the increased rigs.

Why does it matter? I dont think we'll see those spikes above 100 where people were paid stupid money again, as was mentioned above. Just my two cents.

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is it OPEC or is it current inventory reaching a point of production decline? If it costs $50 to produce a barrel but can sell it for $100 or it costs $20 and you can sell it for $70, then what is the big deal? Paying stupid money also drives up the production price per barrel. Complex economic study and pretty interesting.

Because $20 is a lie and $70 is very unlikely. Cost to produce is increasing and is a focal point among analysts this year. Meanwhile, if we pack on production anticipating higher pricing (strip) and it doesn't happen, margins aren't what we thought they were. And we could push prices back lower. Interesting times.

$60K per acre will not pay out. granted right now with equity offering its accretive and with exec comp at public companies a no brainer

Pad drilling, longer lats, better bits, reducing # of casing strings, and cheaper lift systems are sustainable improvements.

aggiebonzo said:

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I was offered my old position (frac engineer) to go back to midland. Currently have a stable job in construction but I miss the oilfield. What're the prospects for short term and long term job stability? I want to go back but would hate to lose my job again this year.

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Lots of people feel the way you do when the oilfield check comes calling, which is why construction companies are so hesitant to hire ex oilfield during the downturns. They know the oilfield will just leave as soon as any hint of recovery is shown.

Plus tighter stage spacing, diverter, more pounds/ ft, etc. Operators are getting the most out of their wells. $50 oil is the new $70.

Sure it is, because no one ever raises prices as oil price goes up.

gigem1223 said:

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Plus tighter stage spacing, diverter, more pounds/ ft, etc. Operators are getting the most out of their wells. $50 oil is the new $70.

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I'd say folks in the eagle ford and Bakker disagree.

Talking to frac and sand companies at the SPE woodlands conference, it seems like sand is the pinch point in 2017. And most service companies aren't bringing on new fleets unless they have committed dedicated work for the entire year. We are already seeing stage prices double from $25k to $50k/stage. Yes, there have been improvements, but a lot of that is going to be masked as service company prices continue to climb.

That's why it's good to have your own Frac fleets and sand mines.

Is Pioneer hiring? I'm in FW.

That's what you would think... talked to a PXD asset manager back in 2014. He said it was as expensive or more expensive to use their own crews compared to outsourcing. Didn't make sense to me but he would know.

They've got a few openings. None that fit me though

https://pxd.wd1.myworkdayjobs.com/PXDCareers

SidetrackAg said:

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Short term, I think you should be ok if they're asking you back. Long term, there will be another cycle in 8-12 years when everyone is trying to make as much money as possible. That's just my opinion though, so may not mean much.

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Not an opinion, it has happened like that since 1970 or so. The question is, how bad will the next one be?

Prices are set by an index based on other service providers pricing. Not sure how they know other providers prices but that's the easiest way to explain it. An asset manager would say its more expensive because that's the cost they see on the surface. But the money is going from one pocket to another. Profit sharing is how they make it work and what actually makes it work financially.

nu awlins ag said:

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SidetrackAg said:

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Short term, I think you should be ok if they're asking you back. Long term, there will be another cycle in 8-12 years when everyone is trying to make as much money as possible. That's just my opinion though, so may not mean much.

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Not an opinion, it has happened like that since 1970 or so. The question is, how bad will the next one be?

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Yeah, that unknown makes for a hard decision. I'm in a good place right now, nice and stable, but there is that itch to go back. There's just something about digging that hole.

SidetrackAg said:

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nu awlins ag said:

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SidetrackAg said:

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Short term, I think you should be ok if they're asking you back. Long term, there will be another cycle in 8-12 years when everyone is trying to make as much money as possible. That's just my opinion though, so may not mean much.

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Not an opinion, it has happened like that since 1970 or so. The question is, how bad will the next one be?

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Yeah, that unknown makes for a hard decision. I'm in a good place right now, nice and stable, but there is that itch to go back. There's just something about digging that hole.

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I totally understand. Nothing quite pays like the O&G industry as well. High risk/high reward. I'm thinking/hoping, that the next slow down is more like the 2008/2009 slow down, which I could see happening with the lack of investment in the big money projects. Those take time and while you can drill in shale and make it happen rather quickly compared to those, the big money projects also produce a lot of oil.