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Monterey Shale downgrade doesn’t dent U.S. shale boom, experts say

May 23, 2014 12:26 PM ETChevron Corporation (CVX) StockCHRD, HES, CVX, EOG, MRO, KOG, CLR, NOG, EOXBy: Carl Surran, SA News Editor5 Comments
  • The revelation that California's Monterey Shale deposit will yield only 4% of what was originally hoped was not a big surprise to those in the know, who say the downgrade does little to alter the near-term trajectory of the energy renaissance.
  • Monterey's terrain, as well as California's strict environmental regulation, always meant full scale drilling would be difficult; Chevron (NYSE:CVX) bemoaned the lack of profit derived from its Monterey operations at a 2013 shareholders meeting, and Venoco - once one of the biggest drillers in the formation - exited most of its Monterey acreage years ago in order to reduce debt and go private.
  • The Monterey news does spotlight an element of the shale boom that often goes unremarked by fracking advocates: Shale wells are prone to rapid depletion rates, as spots in North Dakota's Bakken lose 85% of their capacity within a few years.
  • Among Bakken producers: CLR, EOG, KOG, WLL, HES, OAS, NOG, EOX, MRO.

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