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To: Tom D.

Yes and no. To do so is an enourmous investment that requires expectations for future prices that do not yet seem feasable.

It isn't as if one just goes to the sand with a big truck and gets the oil. You are talking about the construction of a huge infrastructure over a long period of time with costs in the range of 10s of billions.

The second that oil slips below the break-even price, you have a money losing enterprise that will soon go bankrupt.

The profit margin for oil is well over 75%. Enter an industry with a margin like that in which yours is more like selling PCs and you are just asking to lose money.

Also, in order to set up a large enough production to justify the construction of the infrastructure one would have to produce several million barrels a day. And, this would lower the price of oil immediately.

There is a reason no one has done it yet. When oil gets to $70 a barrel maybe.

By the way, creating energy through wind turbines is cheaper than oil at $70 a barrel.


10 posted on 06/22/2004 3:04:02 AM PDT by Einigkeit_Recht_Freiheit (Tax energy not labor.)
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To: Einigkeit_Recht_Freiheit
Never mind losing money – it's often an energy-losing prospect as well. For example, most crops require more energy to plant, irrigate, harvest, transport and process than they'll ever yield. I suspect that the same is true when using them as substitutes for various industrial chemicals.
12 posted on 06/22/2004 3:42:47 AM PDT by Skibane
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