Encana$1.7 Billion

ExxonMobil $2 Billion

Devon$2 Billion

Chesapeake$3.3 Billion

BP$2.11 Billion

BHP$2.84 Billion

(50% of Fayetteville assets purchase)

Write Downs

Shell $2 Billion

$35B in write downs among 15 shale operators in 2013 when oil was still trading around $100/bbl

CAPEX = Free Cash Flow? No

The Real Jobs Story

YOY New Job Creation: Oil and Gas vs. Solar

Source: US Bureau of Labor Statistics, Solar Foundation

YOY

Gro

wth

(000

's)

0.0

8.0

16.0

24.0

32.0

2012 2013 2014

New jobs created - Oil and Gas New jobs created - Solar

In spite of corporate rhetoric, SEC filings indicate that commercial breakeven for tight oil averages

$80-85/bbl

% New Shale Production Needed to Offset Declines

0%

20%

40%

60%

80%

Marcellus Haynesville Permian Eagle Ford Bakken

% New Production

Source: EIA November 2014 Drilling Report, Energy Policy Forum

Huge % New Production Needed to Offset Depletion in Older Wells

Recovery Efficiency How Much Gas Can We Get Out?

“The recovery efficiency for the five major [shale gas] plays averages 6.5%... This contrasts significantly with recovery efficiencies of 75-80% for conventional gas fields.”

Oil & Gas Journal, December 2012

EROEIEnergy Returned On Energy Invested

• Crude, early U.S. - 100:1

• Crude today - 11:1

• Tar Sands - 3:1

• Tight Oil - <7:1

• Troubling dependence on low EROEI fuels

Majors Struggling

-40

-20

0

20

40

60

80

Exxon Shell BP Chevron Total DJIA

% gain % gain

Majors Now Lagging the Dow Where They Used To Lead 5 Year Share Performance 2010-2014

Source: NYSE, Energy Policy Forum