Oil and gas development in the United States in the early 1990`s: An expanded role for independent producers

Since 1991, the major petroleum companies` foreign exploration and development expenditures have exceeded their US exploration and development expenditures. The increasing dependence of US oil and gas development on the typically much smaller nonmajor companies raises a number of issues. Did those companies gain increased prominence largely through the reduced commitments of the majors or have they been significantly adding to the US reserve base? What are the characteristics of surviving and growing producers compared with companies exiting the US oil and gas business? Differences between majors` development strategies and those of other US oil and gas producers appear considerable. As the mix of exploration and development strategies in US oil and gas increasingly reflects the decisions of smaller, typically more specialized producers, what consequences can be seen regarding the costs of adding to US reserves? How are capital markets accessed? Are US oil and gas investments by the nonmajors likely to be undertaken only with higher costs of capital? This report analyzes these issues. 20 figs., 6 tabs