Tag Archives: Great Texas Oil Bust

drilling down

[Note: I have a piece up on CNBC.com today about RadioShack’s impending bankruptcy. Click here if you’d like to check it out.]

Judging by the last few days of trading, it looks like oil prices might (emphasis on might) have found a bottom. That would be bad news for big oil consumers like airlines–not to mention ordinary Americans, who’ve been enjoying a de facto tax break at the pump–but it would come as a major relief to anyone hoping for our incredible domestic energy renaissance to continue.

Last week I attended a one-day energy conference in Denver. Sponsored by a West Coast brokerage, 25 institutional money managers and I visited six E&P (exploration and production) companies at their downtown headquarters. Four of the firms drill in the Niobrara, which is the basin underneath Denver that extends to the Wyoming and Nebraska borders. The fifth drills in the Bakken, which is the relatively new basin underneath North Dakota; and the sixth drills in the Texas Permian basin, the largest oil field in the lower 48 states.

The mood in those offices didn’t quite give me flashbacks to my early days in the investment business, when I watched the entire economy of Houston implode during the Great Texas Oil Bust of the mid-1980s, but I definitely experienced a few minor bouts of deja vu.

Continue reading