Skip to content
Subscriber Only

Explorers Face ‘Pain’ as Oilfield Costs Jump: Wood Mackenzie

  • Steel tubes soared 31% in a year while frack gear rose 22%
  • Smaller drillers especially vulnerable to cost inflation

Shale explorers are in for higher equipment and service costs in 2019 after getting hit with double-digit inflation this year, according to Wood Mackenzie Ltd.

The rate of well-cost increases -- which includes everything from cement to drilling rigs -- is expected to average 9 percent across the contiguous 48 American states next year, down from 13 percent in 2018, according to a report released this week by Wood Mackenzie and Power Advocate, a supply-chain analytics company. But costs would need to surge about 30 percent to really cut into profits.