AI takes aim at shale margins improvement
Poor levels of profitability in shale are prompting a search to use artificial intelligence (AI) to improve the efficiency of production and improve the bottom line
Low oil and gas prices and a failure to throw off free cash flow (FCF) amid continuing high opex costs have hugely taken the lustre off the investment case for US shale over the last year. So, the quest to improve margins has grown ever more important, with AI solutions now being pursued to add to the shale producer toolbox. “There is too much use of existing techniques that are understood,” but which may not be optimal in cost terms, says David Cosby, founder of Longview, Texas-based oil shale R&D firm Shale Tech. One way to raise shale profitability is to focus on production rather than drilling, says Cosby, who works with Ambyint, a US firm which uses AI to optimize the artificial
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