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| US Shale Production |
By Asjylyn Loder
in New York
Quicksilver
acknowledges the company is over-leveraged, said David Erdman, a spokesman for
Quicksilver. The company’s interest expense equaled almost 45 percent of
revenue in the first quarter. “We have taken concrete measures to reduce debt,”
he said.
Drillers are
caught in a bind. They must keep borrowing to pay for exploration needed to
offset the steep production declines typical of shale wells. At the same time,
investors have been pushing companies to cut back. Spending tumbled at 26 of
the 61 firms examined. For companies that can’t afford to keep drilling, less
oil coming out means less money coming in, accelerating the financial tailspin.
Credit: Bloomberg.net
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