Conoco sees U.S. shale growth at 25% in 2019, even as oil slides

HOUSTON AND NEW YORK (Bloomberg) -- ConocoPhillips, the world’s largest independent oil producer, sees shale production growing 25% next year even as crude prices tumble, proving the industry’s resilience in volatile markets, said CEO Ryan Lance.

In the U.S., Conoco wells in the Eagle Ford Shale, Permian Basin and the Bakken field generate cash when prices hover around $50/bbl, Lance said in an interview on Monday in Houston. Conoco pumped 313,000 bopd from the three regions combined during the third quarter, or 25% of the Houston-based company’s global production.

American crude output is surging, contributing to a global supply glut that has pushed prices down by third since the beginning of October. The subsequent squeeze on shale profits may slow growth next year but the industry is in far better shape than it was at the advent of the last slump four years ago, Lance said.

Production growth “slows down at $50 but I don’t think it stops at $50 and it certainly continues if prices get back to $60,” Lance said. Skeptics thought shale “wouldn’t last long but it’s here, it’s a huge resource and it’s going to be resilient and long lasting.”