"Shale-boom profits bypass Big Oil": WSJ headline.

WSJ: “Some of the world’s biggest energy companies are struggling to make money from massive bets on the shale boom in North America, where deposits of oil and gas are proving abundant but not always profitable.” “Royal Dutch Shell PLC, which has had a tough time coaxing crude oil from dense rock formations, said Thursday its shale holdings in the U.S. are worth $2.2 billion less than it had previously determined. ….The company said it would explore selling some of its U.S. shale properties.
Exxon Mobil Corp., the world’s largest publicly traded energy producer, is still feeling the effects of its plunge into U.S. shale gas in 2010, which left it with a big exposure to persistently low natural-gas prices. Rising expenses and falling oil-and-gas production contributed to a 57% drop in quarterly earnings for the Irving, Texas, company. Its profit per barrel of oil and gas fell 23% from a year earlier.
….Along with Chevron Corp., Exxon and Shell are investing at record levels to find and produce energy, aiming to spend a combined total of about $111 billion this year, 8% more than in 2012.
….Exxon and Chevron are sticking to aggressive goals to increase their slumping production over the next four years, by about 14% and 26%, respectively, from 2012 levels.”
Art Berman commentary (e-mail newsletter, no url): “What is not mentioned is that they also paid too much to operate and that thousands of low rate-low volume wells may never be profitable for companies with high overhead structures.  The burden of operating costs is rarely thought of when extolling the miracle of shale oil and gas production.
I believe the WSJ  incorrectly stated the cost of XOM’s acquisition of XTO as $25 b-I recall that the deal was $41 b (http://www.economist.com/node/15127518).
I refer you to my comments about this acquisition in February 2010 (http://www.theoildrum.com/node/6229):
“The mainstream belief that shale plays have ensured North America an abundant supply of inexpensive natural gas is not supported by facts or results to date. The supply is real but it will come at higher cost and greater risk than is commonly assumed. The arrival of ExxonMobil and other major oil companies on the shale gas scene is positive because they will not follow the manufacturing approach, and will do the necessary science that should make shale plays more commercial. This does not, however, ensure success.
ExxonMobil has come late to the domestic shale party. They may have overvalued XTO’s existing wells without fully taking high production decline rates into account. It is also possible that XTO has already drilled the best areas in more mature shale plays, while the potential of newer plays has not yet been established. It is unclear how ExxonMobil’s enormous overhead structure and its associated cost will fit with operating thousands of relatively low-rate gas wells.”