Posted on 11/01/2013 7:03:46 AM PDT by thackney
Most of us are aware by now that the introduction of widespread hydraulic fracturing into the oil and gas business has resulted in a rapid growth in U.S. production. U.S. crude output is up by nearly 2.5 million barrels a day (b/d) since mid-2007 and natural gas production is up by 25 percent. The key question of course is how long production will continue to grow before it inevitably declines. Optimists maintain that we have just scratched the surface of our shale oil reserves and that production will continue increasing for years, if not decades.
Realists are not so sure, noting that not only is fracked oil very expensive, requiring circa $80 a barrel to cover the costs of extraction, but that production from fracked oil wells drops off quickly so that new wells have to be drilled constantly to maintain production. Until recently information about just how fast our fracked oil wells were depleting was rather hard to come by, so that the hype about the US becoming energy independent and a major oil exporter became conventional wisdom for most.
Last week the US’s Energy Information Administration issued the first in a new series entitled Drilling Productivity Report for key tight oil and shale gas regions. This report analyzes the six onshore oil and gas regions in the U.S. where 90 percent of the growth in oil production and nearly all of the growth in natural gas production has taken place in the last few years. The report tallies the number of drilling rigs at work in these six regions; the amount of new oil and gas they are bringing into production each month; and most importantly, the rate at which production from those wells already in production is falling.
Nearly all.. growth... from NorthDakota's Bakken... Texas’s Eagle Ford.
(Excerpt) Read more at oilprice.com ...
So you know we are a net importer. And you still think is we stop exporting we would be energy independent?
You changed the method from this post to the last one.
Yes if we grow production enough we could overcome the need to import. That wasn’t what you wrote.
Sorry, that wasn't you. But it was the post I was responding to.
They tried a nuclear detonation to get the crude oil out but it left a huge underground cavern and they got little oil.
So to become energy independent, we stop exporting the surplus refined products that we don't use, wait for the magic to happen, then stop importing?
I believe it was for Natural Gas.
Project Gasbuggy tests Nuclear Fracking
http://aoghs.org/technology/project-gasbuggy/
It did release more gas, but the gas was radioactive. Although a 50-kiloton nuclear explosion to fracture deep oil shale deposits – Project Bronco – was proposed, it never took place.
Shale gas acquisition deals and enthsiasm are down and somnolent due to the very low US price for nat-gas. Oil being 100x more fungible has a better future at the moment.
I hear this stuff from my cuz who is an energy trader.
The EFFECTIVE Oil and Gas Reserves are a function of the price a buyer is willing to pay for Oil and Gas.
The lower the price the less profitable will be the production of Oil and Gas, and thus the lower the volume of profitable Oil and Gas Reserves.
At a certain point, the demand for Oil or Gas will cause the price to go up, and then there will be more effective (=profitable) reserves.
Although there is a finite amount of Oil Shale in the World, and thus an even smaller finite amount of Oil and Gas that can be produced from that shale, small amounts of Oil and Gas are being continuously generated in some sedimentary basin “kitchens” with suitable conditions.
Estimates of future supply and demand usually deplete Oil and Gas Reserves in the Hundreds of years range.
If I could predict where oil/gas prices were going to move to, I would not have to work for a living. Understanding how the oil industry works is far different than predicting everything that effects the price of oil, like politics, wars and new technology.
Are the Saudis about to crash oil prices just to make life interesting for fracking operations?
I do not believe they have that ability. They are spending more and more dollars themselves for enhanced oil recovery projects. They are no longer doing simple drilling themselves.
If we have a surplus why are we importing? It is not that hard. Use what we have first then buy what we need. Not buy first. Damn economics, I am tired of feeding muzzies missile money.
Where did you hear about this ?
If true, there will come a day when their domestic gasoline (sold at $0.45 per gallon) subsidies will cost them real money instead of representing opportunity cost.
We do not have a surplus of crude oil. We need a lot more crude oil to meet our demand of refined products.
We are exporting some surplus refined products. Since our domestic demand is smaller than our total refinery capacity, we import more crude than we need and export the higher dollar value product. It keeps more jobs in the US, helps keep us a running refinery capacity surplus, and give a bit to help our trade balance.
It is not that hard. Use what we have first then buy what we need.
We are.
Crude oil is not the same as gasoline. It takes refining first.
It cost them real money now. They consume ~3 MMBPD and only refine 2.1 MMBPD. They have to pay someone else to refine the difference, import the product, then give it away in country.
http://www.eia.gov/countries/cab.cfm?fips=SA
I suspect it was while boating on a major river in Egypt.
http://oilshalegas.com/greenriveroilshale.html
Here are some more interesting facts that I will soon forget.
I still think nat gas is hotter...
Not exactly. If prices fall and profits with it, you can increase revenue by increasing production. The only problem is “cost of production”. As technology advances or regulation declines, “cost of production” will also decline.
Americans are terrific at this. We can do the same with energy and produce giant volumes of low cost energy while protecting the environment. Capitalism works! Unchain the capitalists, set them FREE.
Yes, but out of date.
They talk about the same Shell project I linked as ending around 2010~2012. So it was written before 2010. The results of the completed test are available.
I don’t know why you think that. Less BTUs, smaller molecule with less atoms to oxidize. Test result show differently.
But hope springs eternal...
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