Debt becomes the most important factor for E&P cos future Below there is the relevant data about U.S. shale companies. The investors who consider that debt is very important these days so they avoided indebted firms (and they are bying currently Debt-free producers like CKE), proved right:
"Are More Bankruptcies On The Way For U.S. Oil?
Something that’s been whispered about in the last few months is now being talked about loudly: U.S. oil drillers’ debts.
There have been a few notable warnings that shale boomers might want to slow down their production boost lest they bring on another price crash, but the truth seems to be that they can’t do it: they have debts to service.
Now that international oil prices are once again on a downward spiral, drillers are facing a new challenge, according to Bloomberg: their bondholders are no longer optimistic.
The elephant in the shale room is that despite remarkable advancements in cost-cutting, shale drillers have needed to borrow heavily in the last few years—first to grow, and then to survive the downturn. Last year, Moody’s warned that oil and gas drillers and service providers face a debt load of US$110 billion maturing by 2021. Next year alone, the industry would have to repay US$21 billion. By 2021 this will grow to US$29 billion. What’s more, Moody’s said, 65 percent of that debt is speculative-grade, or junk."
https://oilprice.com/Energy/Energy-General/Are-More-Bankruptcies-On-The-Way-For-US-Oil.html