Over the past several years, investing in upstream oil and gas development has been a fool’s errand. Despite incredible growth in production here in the United States, the vast majority of the value – and by value I mean retained profits – has fallen into the hands of the midstream and downstream asset operators. Any company that has managed to succeed in generating returns above its cost of capital has most often plowed that money back into the business.
That operational viewpoint is changing and perhaps with that change the balance of power will shift.