Independent oil companies receive almost all of their revenues from production at the wellhead. They are normally only in the exploration and production segment of the oil industry. They usually don't market or refine oil. Independent oil and gas producers operate the majority of wells in the United States.
Independents are risk takers, entrepreneurs. In the early days of oil exploration they were called "wildcatters". Wildcatters were willing to take on a lot of risk in their search for oil and natural gas. They were the twentieth century version of the nineteenth century's cowboy. Like those ending up in the gold rush in California wildcatters were looking for the big hit - the gushe or gold vein to produce a fortune. Drilling for oil, like searching for gold, was risky but thrilling. Independent oil producers today embody the entrepreneurial spirit of wildcatters but are highly efficient, well organized corporations. They are smaller, leaner and have more focused operations than the major oil companies.
The oil busts of the 1980s and 1990s put most of America's wildcatters under. Today with oil selling at $70 a barrel oil exploration can be profitable. The major oil companies look for huge finds all over the world which is why the independents do most of the oil exploration in the United States. In 2005, 1384 new fields were drilled and many abandoned fields were explored with new extraction techniques that make them profitable again.
Independents are receiving huge benefits from technological advances. Advances in technology have cut in half the costs of oil exploration and development. The Department of Energy has a "Technology Development with Independents" program. The program assists small independent oil producers test higher-risk technologies to keep oil flowing from their wells. The independents contribute over 70% of the investment needed for these programs. These programs have boosted oil production in marginal wells.
A critical issue independent oil company's face is a worker shortage. This shortage is caused by an aging workforce and the decline in employment experienced in the industry from 1980 through 2001. Employment in the industry declined from 582,900 in 1985 to a little over 300,00 in 2001. Today due to growth in the industry there is a shortage of experienced personnel which is impacting the capability to meet demand at times.
Domestic oil exploration and production accomplished by independent oil companies like, Western Pipeline Corporation, is opening up new sources of oil and natural gas and reviving production from older, abandoned fields to increase domestic supplies.
About the Author
Bob Jent is the CEO of {a href=" http://fe48.news.sp1.yahoo.com/s/prweb/20070721/bs_prweb/prweb541282"}Western Pipeline Corporation.{a href=" http://fe48.news.sp1.yahoo.com/s/prweb/20070721/bs_prweb/prweb541282"} Western Pipeline Corp specializes in identifying, acquiring and developing existing, producing reserves on behalf of its individual clients.
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