Shut-in (oil drilling) explained

In the petroleum industry, shutting-in is the implementation of a production cap set lower than the available output of a specific site.[1] This may be part of an attempt to constrict the oil supply[2] or a necessary precaution when crews are evacuated ahead of a natural disaster.[3]

In April 2020, as a result of oil futures trading negative, Oklahoma and New Mexico voted to allow wells to shut-in in order to reduce production to combat oversupply.[4]

Notes and References

  1. Web site: Staff Writer. Double-Tongued Dictionary. 2004-09-24. 2008-08-19. Dictionary definition of "shut in".
  2. Oil supply held precarious, gas reserves just adequate . Thomas . Kennedy . 1978-03-01 . 2008-08-19.
  3. Web site: Susan Weaver. U.S. Department of the Interior. 2005-08-30. 2008-08-19. Hurricane Katrina Evacuation and Production Shut-in Statistics Report as of Tuesday, August 30, 2005. dead. https://web.archive.org/web/20080918013520/http://www.mms.gov/ooc/press/2005/press0830.htm. September 18, 2008.
  4. Web site: Oklahoma will let struggling oil producers halt output without breaking contracts. Liz Hampton. Reuters. 2020-04-22. 2020-04-22.

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