The economics of oil and gas drilling in the US have changed since 2014, when oil prices entered their current protracted slump. Between 2011 and the end of that year, the price of oil was so high that almost any unconventional play was considered economical. Following the price crash, though, companies were forced to look more closely at costs. In a low oil price environment, they found the costs associated with many new wells were too high to justify.
Since late 2016, the price of oil has recovered somewhat, and the industry has returned smarter and leaner, drilling only in plays that have the strongest potential profitability. Two especially interesting locations for this activity are Oklahoma’s SCOOP and STACK. But what, exactly, makes the plays in Oklahoma more profitable than others?