These energy companies are running low on cash
February 1, 2016, 5:47 pm

The deep slide in global oil prices may start claiming the scalps of a number of oil companies.

One in 5 energy companies could be out of cash in less than six months, while 1 in 3 will hit that threshold in less than a year, according to a Big Crunch analysis.

Publicly traded energy companies as a whole may have $284 billion in cash and short-term assets on their books, but more than 80 percent of that money belongs to the 25 largest companies. Those entities also tend to still have positive cash flows — even the few that are negative have enough cash to last at least two years, according to Big Crunch calculations.

Yet the smallest energy companies — the ones whose names are not as well-known as ExxonMobil, BP or Chevron — are not as lucky. Dozens of small energy companies had already filed for bankruptcy by December, owing a collective $13 billion, according to law firm Haynes and Boone. Many more could join them in the next year, and some may be scooped up by opportunistic buyers. Expects say that as many as a third of American oil and gas companies and half of U.S. shale drillers could disappear into insolvency before oil prices recover.

Looking at the smaller half of companies traded on the NYSE and Nasdaq, more than half of those companies are burning cash fast enough to be out within six months (based on their cash flow in the last two reported quarters).

Here`s what the overall market looks like, with every energy stock with reported data — blue companies have positive cash flow and the dark red shade means less than a year of cash at that company`s burn rate.

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