The U.S. "Fracking Industry" is a Cash Burning Machine -- the Great American Shale Oil and Gas Bust !

Shale 

oil and gas 

made the US 

the largest 

natural gas 

producer in 

the world.

This year 

we became

the largest 

crude oil 

producer in 

the world too. 

Oil and gas 

provides lots 

of high-paying 

blue collar jobs.

Unfortunately,

the shale 

industry

is collapsing

financially.

The industry 

has 

always been 

cash-flow 

negative.

Shale

oil and gas 

production 

remains 

too high.

High 

production 

keeps the

oil and gas 

prices too low 

for the industry 

to ever become 

cash flow positive.

One root cause

is that executive 

compensation 

rewards increased 

production, so 

production keeps 

increasing.

The industry 

has been brutal 

on investors, 

deadly at the 

low current 

oil and gas

prices. 

SHALE  INVESTORS   

ARE  SUFFERING

Investors' money 

has been "drilled 

into the ground".

In the first three 

quarters of 2019,

32 oil and gas 

drillers filed 

for bankruptcy, 

according to 

Haynes and 

Boone.

Many others

filed for 

bankruptcy

in October and 

November 2019 .

Last Monday, the

natural gas producer 

Approach Resources 

filed for bankruptcy.

There were over 200 

bankruptcy filings, 

of oil and gas drillers,

since the beginning 

of 2015.

Chesapeake Energy

               [CHK]

has been burning cash 

since it started fracking. 

-- It has borrowed 

large amounts

of money.

-- It's selling assets 

to raise cash.

-- It's debt is nearly 

$10 billion. 

-- CHK is only

60 cents a share.

(November 26 close)

A November 5, 

SEC filing

warned of 

its own demise 

with the dreaded 

 "going concern"

notice obviously 

demanded by 

CHK auditors:

“If continued 

depressed (oil) prices 

persist, combined 

with the scheduled 

reductions in the 

leverage ratio covenant, 

our ability to comply 

with the leverage ratio 

(bond) covenant during 

the next 12 months 

will be adversely 

affected which raises 

substantial doubt about 

our ability to continue 

as a going concern.”

In early 2016, 

Chesapeake 

had  used the threat 

of bankruptcy to push 

creditors into accepting 

a debt restructuring. 

CHK is very close

to a bankruptcy filing.

Whiting Petroleum 

         [WLL] 

spiked to $370 

in August 2014.

Its shares trade 

at $4.83 now.

(November 26 close)

Back in 2015, 

Carbo Ceramics 

          [CRR] 

still traded at 

over $40,

back in 2015. 

It's shares trade 

at 40 cents now.

(November 26 close)