Who Hurts if U.S. Drilling Slows?

The oil and gas sector is a complex system with lots of moving parts.  So when drilling projections for 2013 anticipate a slowdown, different industries within the sector could move in opposite directions. In this video, Motley Fool contributor Tyler Crowe breaks down which industries will continue to do well and which ones will get hurt.  Investors will want to keep an eye on equipment and services companies, because this could affect them the most. One company in this space that has a lot at stake is Heckmann (NYSE: NES  ) . Will the slowdown across the U.S. take the company's fortunes with it? 

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  • Report this Comment On January 08, 2013, at 1:56 PM, mikevr1463 wrote:

    Art Berman frequently points out that a primary determinant of Henry Hub spot NG price [aside from winter coldness] is the number of existing, incompleted wells --drilled but not yet fracked / connected to a pipeline-- that were created by E&P companies before "hurriedly" moved their rigs to the more economic oil / NGL plays.

    IF A LARGE NUMBER OF INCOMPLETED NG WELLS CURRENTLY EXISTS, operators may prolong the depression of NG prices by maintaining NG productions using the lesser (completion) CAPEXs. Under these circumstances, demand for HEK's water services for NG fracking may actually increase during 2013. Moreover, the demand for HEKs water services in oil fracking should also be increased because more E&P companies are planning 2013 operations in the Bakken and Eagle Ford plays.

    Cheers,

    Mike

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