Electric fracking reduces to cost of West Texas oil wells

Reuters:

At a dusty drilling site east of San Antonio, shale producer EOG Resources Inc recently completed its latest well using a new technology developed by a small services firm that promises to slash the cost of each by $200,000.

The technology, called electric fracking and powered by natural gas from EOG’s own wells instead of costly diesel fuel, shows how shale producers keep finding new ways to cut costs in the face of pressures to improve their returns.

E-frac, as the new technology is called, is being adopted by EOG, Royal Dutch Shell Plc, Exxon Mobil Corp and others because of its potential to lower costs, reduce air pollution and operate much quieter than conventional diesel-powered frac fleets. Investment bank Tudor, Pickering Holt & Co analyst George O’Leary estimates e-fracs could lop off up to $350,000 from the cost of shale wells that run $6 million to $8 million apiece.

While a handful of oil producers are capturing savings from lower well costs, the picture is less rosy for oilfield service providers. These systems can cost them up to twice that of conventional fleets to build. A rapid uptake could worsen the economics for a sector cutting staff and idling equipment as oil producers pare spending. That leaves this potential breakthrough technology in the hands of small service providers without the means to fully exploit it.
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The traditional oil well service providers are not happy about this change.  The anti-energy left in the Democrat party are probably also unhappy by a new efficient way to cut cost in oil and gas production.  Some have already pledged to outlaw fracking because of their irrational hatred of fossil fuels.