Dog days for the wildcatters

The creditworthiness of independents is falling. Barely-positive cash flow and weak enthusiasm for consolidation may not be enough to save them

While US shale production volume continues its unremitting rise, the pioneers of the industry are struggling to keep their heads above water without injections of fresh capital. The latest firm to fail was Sanchez Energy Corporation on 11 August, with $2.275bn of debt. It was the 26th bankruptcy of the year and leaves the total just shy of the 28 that succumbed during the whole of 2018. Corporate law firm Haynes and Boone found that the 192 failures since 2015 involved more than $47bn of debt. It is not surprising that investors are losing patience. Free cash flow—which facilitates capital spending without outside financing or the sale of assets—is a key measure of financial health. The Inst