Quarterly Reports

INFLATING 5/24/2022

Inflating

Payne Institute Program Manager Brad Handler has prepared a quarterly report on how the top priority for the U.S. public oil and gas (O&G) companies remains to deliver higher financial returns to shareholders. Public commentary as the companies reported their 1Q22 earnings included widespread commitments to pay higher dividends and to buy back shares of their own stock.  Yet, only a couple of months after laying out their spending expectations for 2022, the companies have also begun to raise their spending budgets for the year. These increases are largely in response to rising prices for goods and services, a function of supply constraints.  May 24, 2022.

Oil Companies and Wall Street Gain Confidence 3/31/2022

Oil Companies and Wall Street Gain Confidence

Payne Institute Program Manager Brad Handler has prepared a quarterly report on how stronger oil and natural gas prices have infused oil companies and Wall Street with confidence about future prospects, although remaining in shareholders’ good graces by not “over-spending” continues to dominate U.S. public oil and natural gas (O&G) industry mindset.  March 31, 2022.

Staying-the Course Despite Higher Prices 12/9/2021

Staying-the Course Despite Higher Prices

Payne Institute Fellow Brad Handler has prepared a quarterly report on how restoring attractiveness to shareholders continues to dominate U.S. public oil and natural gas (O&G) industry mindset. Thus far, company commentary for 2022 is to “stay the course,” i.e., (1) maintain spending at current levels despite commodity prices that suggest they can earn (and therefore spend) much more money and (2) give back more money to shareholders than they have historically. That leaves the expectation that private oil companies will continue to raise their spending faster than their public peers – and that U.S. oil production will only gradually continue to recover. This discipline, as well as operating efficiencies, also imply that industry hiring recovery is likely to remain muted.  December 9, 2021.

Consolidating 9/9/2021

Consolidating 

Payne Institute Fellow Brad Handler has prepared a quarterly report on how U.S. public oil and natural gas (O&G) companies continue to try to win back investors by spending less of their cash flow, the second quarter of 2021 (2Q21) marked a surge in these companies also turning to acquisitions to position themselves for longer term efficient production. The implications of industry consolidation for spending and employment can be unclear.  September 9, 2021.

Managed Recovery 6/21/2021

Managed Recovery

Payne Institute Fellow Brad Handler has prepared a quarterly report on how the U.S. public oil and natural gas ( O&G) extraction companies continue to focus on spending less, through a combination of realizing efficiencies and growing more slowly. Consistent with this, more O&G companies are making specific commitments to use their profits to pay dividends to shareholders ( and to lowering carbon emissions) in an effort to “win back” investors. The future for the U.S O&G industry appears likely to include higher productivity, propelling further recovery in produced volumes but using fewer workers and concentrating in the most prolific basins. June 21, 2021.   

U.S. OIL & GAS companies settle in to more conservative approach 3/22/2021

U.S. OIL & GAS companies settle in to more conservative approach

Payne Institute Fellow Brad Handler has prepared a quarterly report on the upstream U.S. onshore oil & gas extraction activity and how the prevailing message from publicly-traded (i.e. generally larger) oil companies is that activity (and thus employment) recovery in the U.S. is to be subdued. Publicly-traded oil companies are setting up to be more conservative for multiple years with respect to spending as they seek to win back the confidence of investors and other capital providers.  March 22, 2021.   

Oil & Gas Prepares for a Constrained Future – U.S. Oil & Gas Extraction Briefing – Third Quarter, 2020 12/18/2020

Oil & Gas Prepares for a Constrained Future

Payne Institute Fellow Brad Handler has prepared a quarterly report on the upstream U.S. Oil and Gas (O&G) industry and how it is preparing to spend less annually in 2021 and 2022 than it did in 2017-19.  Instead, companies in this sector are focusing on improving financial returns, strengthening financial condition and returning cash to investors. This translates to the companies: 1) targeting only their “best” opportunities, 2) seeking more cost and operating efficiencies, 3) continuing to lay off staff and to some degree 4) pursuing mergers. The emphasis on cost efficiency portends an even greater shift in relative activity to the Permian basin, including the less developed but prolific Delaware play. The third quarter of 2020 (3Q20) saw the industry begin to resume investment after significant curtailments in 2Q20. December 18, 2020.   

 

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DISCLAIMER: The opinions, beliefs, and viewpoints expressed are those of the author alone and do not reflect the opinions, beliefs, viewpoints, or official policies of the Payne Institute or Colorado School of Mines.