Forbes has an article on decline rates in the shale that you should read, particularly if you are reading other, much more pessimistic evaluations. A sample: "But decline rates are only one variable determining production levels, the other being additional drilling. Production is the result of the natural decline rate and offsetting investment, such as infill drilling, water or gas injection, and many other techniques. As far back as 1990[i], I reported that forecasters were generating overly pessimistic production curves because they were omitting efforts to improve recovery in known fields, a significant source of new supply. This investment is not reported in any way that permits it to be measured or predicted, but it does seem to correlate with cash flow (oil prices) and thus, likely declined after 1998, which goes a long way towards explaining the subsequent weakness in global production. *** Unlike the Red Queen, the oil industry has managed to not only stay in place but race ahead, confirming that decline rates are only one factor determining supply. Individual country production trends highlight the fact that decline rates can often be overcome."
One of my favorite lines: "But as so often, reality is to theory as windshields are to bugs on the highway. Natural gas drilling dropped by 50% when prices collapsed in 2008, and production responded not by declining at 5, 10 or 15%, but continuing to increase." (Emphasis is mine.)
Read it all.