Nevada produces very little oil. But according to the Las Vegas Sun, Noble Energy has plans for 18 oil wells in Elko County. Permits are pending.
The Las Vegas Sun reported:
In Nevada, Noble’s plans include spending $16 million to $32 million to drill four wells to transport fossil fuels from below ground to above ground, according to the company’s earnings reports. Noble’s arrival signals major potential in a state not known for fossil fuel production. But it doesn’t guarantee a boom.
So with oil prices plummeting in recent months, many are wondering if oil drilling in Nevada could go bust even before it ever gets going.
Sweet light crude oil rose 2.5 percent to above $49 a barrel Wednesday. Despite the upward movement, numbers from Reuters news service, shows oil prices are down more than 50 percent since June because of an oversupply and OPEC’s decision not to curb output even as the U.S.’s oil industry continues to grow.
But oil industry watchers wonder just how long U.S. companies will continue their high level of drilling and production with prices dropping, according to a story by NPR’s Jeff Brady.
Brady told KNPR's State of Nevada that almost every day oil companies and contractors are laying off people. The latest company to announce layoffs is Halliburton, which contracts with oil companies to build wells.
However, Brady points out the money Noble is laying out for the project in Elko County is a small bet. The company's market cap is $17 billion and the investment in Nevada is only $30 million.
He said that what ever happens next in Nevada's oil industry could really depend on what was found in the test wells, but the oil the company is looking for is locked deep down in shale, which is difficult to access.
Guest:
Jeff Brady, energy industry reporter, NPR
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