[OilmanChoke]

Well, you certainly have your judgements. I like efficiency. I think it a natural law... one that systems tend towards over time. I am confounded that you would want to limit energy use. That is a bias, it seems to me.

Can you elucidate further on the tax breaks and exemptions the oil business gets? I hear that all the time, yet my accountant can seem to find the damn things. Perhaps you can educate me and him. Given that I pay a severance tax off the top, along with ad valorem taxes along the way BEFORE I get to income taxes, I feel that I pay a disproportionate amount. But I could be wrong. Reading ExxonMobil's annual report, (in fact, any of the big companies annual reports) show that they pay more in taxes and excise fees than they make in profits. Perhaps that is the problem? The governments are they biggest stakeholders in oil and gas?

I have met Matt Simmons several times, and find him an enjoyable and thought provoking speaker and writer. Similarly, I find Scott Tinker, of the Bureau of Economic Geology and President of the American Asscoiation of Petroleum Geologists equally provoking. Thanks for the links.

Given that the industry pays so much in taxes that are peculiar to the oil and gas business (preferential taxes), what further costs or penalties should the industry pay for? How would you calculate these cost allocations and would you allocate severance and ad valorem taxes against it? Since governments are the largest fiduciary beneficiaries of oil and gas production, what part of the cost is borne by them?

[Twilight]

About lagging economic effects - we filled the financial hole with credit and the energy hole by coal substitution. These are large enough factors to tide us over for years. However, since there is a limit to how many oil-fired power plants can be demolished and there is a limit to how much risk/pain creditors can handle before they choke off the line, this reserve of 'resilience' will not last forever. The problem with credit is well-known to anyone who has picked up a copy of the FT lately, but demand destruction is particularly interesting because is not going to remain confined to sectors where easy substitution is possible. Yesterday it was power plants, tomorrow it will be airlines. Then personal motoring. Agriculture, chemicals and lubricants will be pretty low down the list, some future generation can worry about that, but there do come points where supply constraints go from creating opportunities, to being a zero sum game, to eating the system.

[skyemoor]

I am confounded that you would want to limit energy use. That is a bias, it seems to me.

Of course, because you want to sell as much as you can. I, on the other hand, do not have a vested interest other than wanting my country to survive an impending economic crash and leaving a world for my children without catastrophic levels of climate change. While this is not a thread about climate change, I'll at least point you to a list of scientific organizations and their stance on the subject matter.

Can you elucidate further on the tax breaks and exemptions the oil business gets?

Certainly. Here's a Bloomberg link for starters, though I'd be very surprised if this was news to you.

These tax breaks were supposedly intended to incentivize a growth in new projects and technology, but it seems the oil companies chose to spend most of their burgeoning profits buying back their stock.

Given that I pay a severance tax off the top, along with ad valorem taxes along the way BEFORE I get to income taxes, I feel that I pay a disproportionate amount. But I could be wrong. Reading ExxonMobil's annual report, (in fact, any of the big companies annual reports) show that they pay more in taxes and excise fees than they make in profits.

Yes, most companies regardless of their vertical market pay more in taxes than they make in profit.

Given that the industry pays so much in taxes that are peculiar to the oil and gas business (preferential taxes), what further costs or penalties should the industry pay for? How would you calculate these cost allocations and would you allocate severance and ad valorem taxes against it?

First, are you talking about upstream or downstream? If upstream, then spell out for us the percentage of taxes you are paying compared to your projected production.

[TonyPrep]

I am confounded that you would want to limit energy use. That is a bias, it seems to me.

Wow, do you have no idea of human-induced climate change, resource depletion or sustainability? If you had, you wouldn't be so amazed that someone could propose limiting energy use.

[OilmanChoke]

Ahhh. Spoken like a true statist! Of course, in order to first see things as you do, I need first to accept Climate Change as being largely driven by anthropogenic greenhouse gasses, that some wacky meaningless word... "sustainability"... will mean anything in 50 or 100 years, and that resource availability are as described by folks that have one agenda or another and disconnected to the reality of resource availability.

My point in all of this is that it seems you have decided that hydrocarbons are a declining resource, energy should not be abundant, and that work by clever folks to promulgate either one should be stifled for reasons that are based more upon your value system than science or capacity alone.

If it is going away anyway, why regulate it so heavily? Why not promote drilling all over the world as much as possible so we don't need to have a meaningless debate about whether it is going away or not? In the end, like I said, it is about cost. I am certain that other energies will achieve attractive cost efficiencies on their own over time. Betting on human ingenuity is the one sure best bet historically. Betting on regulations to "solve" problems we cannot even agree we are having is nearly a sure bet the other way.

[Nicholai]

Oilmanchoke, you have made 4 posts so far, I would be weary of patronizing or repugnant responses (not that I mean this in a mean-spirited way, simply a word of caution)

Betting on human ingenuity is the one sure best bet historically'

By 'betting', you mean relying on faith.

Some have faith in the Catholicism and some have faith in Capitalism, but faith is faith.

I would recommend you take a look at 'The Best of MonteQuest' at the top of 'Peak Oil Discussion'. These 4 pages are well worth your time.

'I need first to accept Climate Change as being largely driven by anthropogenic greenhouse gases'

First of all you spelled 'gasses' wrong. Second, if you haven't accepted climate change as a human induced change brought on by fossil fuel consumption, your arguments will not be taken seriously.

'My point in all of this is that it seems you have decided that hydrocarbons are a declining resource, energy should not be abundant, and that work by clever folks to promulgate either one should be stifled for reasons that are based more upon your value system than science or capacity alone. '

When you say 'decide', do you mean 'use data compiled by reliable third parties and think tanks to reach logical and sound conclusions'?

I'm not sure what point you're trying to make (Oilmanchoke) but I'll just end with two recommendations.

1) Optimistic predictions should never be generalized, your arguments will simply be dismissed.

2) Faith is not an argument.

[skyemoor]

Spoken like a true statist!

Another link for your edification (as you are new here) is the DoE report Peaking of World Oil Production: Impacts, Mitigation, and Risk Management, which states;

The problems associated with world oil production peaking will not be temporary, and past “energy crisis” experience will provide relatively little guidance. The challenge of oil peaking deserves immediate, serious attention, if risks are to be fully understood and mitigation begun on a timely basis.

Peaking will result in dramatically higher oil prices, which will cause protracted economic hardship in the United States and the world.

Mitigation will require a minimum of a decade of intense, expensive effort, because the scale of liquid fuels mitigation is inherently extremely large.

Intervention by governments will be required, because the economic and social implications of oil peaking would otherwise be chaotic.

So if you wish to label the last paragraph above as 'statist', you are more than welcome, though such a perjorative (in some circles) carries little weight with the average member here.

Of course, in order to first see things as you do, I need first to accept Climate Change as being largely driven by anthropogenic greenhouse gasses, that some wacky meaningless word... "sustainability"... will mean anything in 50 or 100 years, and that resource availability are as described by folks that have one agenda or another and disconnected to the reality of resource availability.

Many points here:

- I gave you the link concerning the scientific consensus on Climate Change and other threads are more suited to that discussion.

- Sustainable Energy definition: Energy that can be produced economically and safely for all time without impacting the environment and well-being of future generations. http://www.cotswold.gov.uk/nqcontent.cfm?a_id=1484

- Resource Availability: If you have concrete evidence that a peak will not happen in the next 10 years, everyone on this site will trip over themselves to see it. Caveat: There are many people on this site that are in the industry and won't be bamboozled by a 'baffle with bull$hit' approach. And don't think that espousing data from IEA, EIA, or CERA will get you anywhere here, especially with their horrible track record of predicting production.

You use of condescending terms such as 'wacky' and 'disconnected to reality' are recognized as simplistic positioning ploys on the part of a new poster. Continued use of similar terms by you will see the perception of your veracity drop. Make sure you read the Code of Conduct.

My point in all of this is that it seems you have decided that hydrocarbons are a declining resource, energy should not be abundant, and that work by clever folks to promulgate either one should be stifled for reasons that are based more upon your value system than science or capacity alone.

Read the DoE report, and understand that there will have to be a transition to a different lifestyle; why cling to an antiquated, dead-end way of getting around? And it's not just mobility, but plastics, agriculture, and other impacted areas that will also require some form of transition. Those transitions will require the true innovation and new thinking we need to keep civilization from experiencing extended hardship and/or collapse.

If it is going away anyway, why regulate it so heavily?

While I haven't used the term 'regulation', measures must be taken to enable the transition away from hydrocarbon fuels. Increased CAFE requirements are one, though they are not technically an oil regulation.

Why not promote drilling all over the world as much as possible so we don't need to have a meaningless debate about whether it is going away or not?

Why not head for a cliff at 90 mph? Don't listen to the meaningless protestations from anyone in the passenger seats.

The US peaked in 1970. In the ensuing years, drilling went up fourfold in the lower 48 States, but oil production continued to decline steadily. Perhaps this is a surprise to you, perhaps not.

In the end, like I said, it is about cost. I am certain that other energies will achieve attractive cost efficiencies on their own over time. Betting on human ingenuity is the one sure best bet historically. Betting on regulations to "solve" problems we cannot even agree we are having is nearly a sure bet the other way.

I agree that cost is a key driver, though I include external costs such as GHG emissions, pollution, resource depletion, economic crises, reductions in agricultural output, etc. We've been betting on human ingenuity to provide us with cold fusion for over 3 decades. At some point we simply have to bite the bullet and make sensible choices.

I can understand that your prosperity revolves around the continued addiction of America to oil (Bush's own terms).

Upton Sinclair wrote,” It is difficult to get a man to understand something when his salary depends upon his not understanding it.”

[OilmanChoke]

Wow. Such verve! The thing that is most interesting to me here is that while I derive a goodly amount of my income generating energy (not just oil and gas), I certainly am aware and interested in alternatives, because, after all, it is my business. If I offend some of you, it is because you don't like seeing YOUR faith attacked. I am not an energy bigot. I am fully aware of the state of the science on climate change.

Given that we are just understanding non traditional reservoirs, and that a tremendous amount of research is going into how to exploit clathrates, I suspect that we will see great amounts of energy to benefit us all from hydrocarbons in the future. Lots of smart people working on these problems, just like there are lots of smart people working on solar/wind/algae etc. My brother is a Silicon Valley guy with significant investments in alt energies. Lots of brain power at work there. Lots of bets on the table. Most won't work. Some will. Deciding right now which one will work is an uninformed position. Your statement that breakthroughs in hydrocarbon extraction technologies and new understandings on how reseroirs operate is somehow "wish-based" is not a well informed position. The 1980's saw a huge run up in drilling because of bad tax policies and high commodity prices, NOT technology usage or new understandings on reservoirs. I will put together the statistics to show that this industry is getting better at drilling and producing hydrocarbons. You might also want to normalize the oil production with the gas production charts and have a BTU production chart, which is more telling anyway.

I DON'T think that hydrocarbons will be as dominant a player in the future as in the past, because the demand is going up dramatically wordlwide as China and India have decided to up there standard of living.

As such, resource allocations shift, and they do so naturally. You might ask yourself why this is so challenging to your worldview?

Is this going to be one of those forums where I check to make sure I didn't type too fast and misspell something? Or use improper grammar? Or end a sentence in a preposition? Or else I will look stupid? Trust me, tt doesn't take spelling to make me look stupid. Just ask my wife. I apologize for saying that the word sustainability is "wacky". Sustainability, or the concept thereof, must truly be important to cause such offense. In any case, have a happy New Years.

By the way, here is the first part of a poll of climate scientists from 1996 and rerun in 2004.

http://openchoke.blogs.com/

[dinopello]

Actually, being concerned about sustainability is a little wacky when you think about it. Why should anyone be concerned about what things are like after you die ? It would almost seem more natural to want to burn this sucka down before leaving. I often wonder why I care, especially since I don't have kids and I'm not really religious.

[Nicholai]

Repugnant conservatives...despite their faith, they will never go down with the ship...or at least not willingly

I didn't correct your spelling because I'm priggish, you're just kind of a dick so I thought I would hassle you

China increased its energy demand by 20% in 2005.

The top 3 elephant fields in the world (with EROEI ratios of 1:30) are now in decline (at rates of up to 15% per year)

Most major development is now taking place within P2 and P3 deposits which have EROEI ratios of between 1:10 and 1:3 (more expensive to produce)

Supply bottlenecks will cause greater ethanol investment in poorer regions, driving the cost of staple food crops to ever increasing highs (more unstable regions due to starvation, higher fuel costs etc.)

These P2 and P3 deposits will require massive amounts of energy for production (12 bathtubs of water each second for the Athabasca tar sands) and will entail much greater cost (both in terms of overall investment, environmental costs, political ramifications for such projects etc.) Ask any Albertan if they would like to see the size of Fort MacMurry doubled or tripled (to allow for 5mbd) and you would certainly get a No, this poses major political ramifications

We are seeing an increase in global hydrocarbon demand beyond anything we have seen in all human history, and yet the amount of projects needed to outweigh both the rate of decline in our old and highly profitable conventional fields plus the enormous pace of demand growth are forcing us into unchartered and highly unstable ground.

With more storms, more droughts, more instability in food prices and commodities prices, hyper growth in our population and a depletion in our most profitable and productive oilfields I can guarantee that this will not go as smooth as some may want it.

And, seriously, if you haven't accepted global warming, I would recommend you clean out whatever sits between those ears of yours.

[skyemoor]

The thing that is most interesting to me here is that while I derive a goodly amount of my income generating energy (not just oil and gas), I certainly am aware and interested in alternatives, because, after all, it is my business. If I offend some of you, it is because you don't like seeing YOUR faith attacked.

No, words like 'wacky' and 'disconnected to reality' in intrinsically offensive. I'm open to analyzing new data at any point.

I am not an energy bigot. I am fully aware of the state of the science on climate change. By the way, here is the first part of a poll of climate scientists from 1996 and rerun in 2004.

http://openchoke.blogs.com/

You seem to put all your eggs in the Bray and Storch basket (though I'm sure you are a Micheals, Christy et al fan as well); I do not, and their report was rejected by the journal Science. However, your website shows clearly cherry-picked points, so it is easy to see your obvious bias, regardless of how neutral you claim to be.

One example: Fig 31 of their [/quote]2003 Survey asks the question, "We can say for certain that, without change in human behavior, global warming will definitely occur some time in the future." On a scale of 1 = Strongly Agree, 7=Strongly Agree, the mean response was 2.35, which shows a high level of agreement with that statement.

Another example: Figure 34 shows the response to the statement, " There is enough uncertainty about the phenomenon of global warming that there is no need for immediate policy decisions" to be in strong disagreement at 5.67.

So your evidence is shaky to begin with, then you carefully data-mine to distort the overall conclusions.

Given that we are just understanding non traditional reservoirs, and that a tremendous amount of research is going into how to exploit clathrates, I suspect that we will see great amounts of energy to benefit us all from hydrocarbons in the future.

Possibly. This depends on how fast new breakthroughs can be achieved, how fast they can be piloted, how fast they can be installed on a significant production basis, with all of the requisite infrastructure.
To truly be of benefit, they would need to be non-polluting (including GHGs). Hence, because I believe a peak will occur before this time period, and that extraction/combustion of these hydrocarbons will not be GHG-neutral, I doubt that we will see "great amounts of energy to benefit us all from hydrocarbons in the future", regardless of how inspiring that was intended to sound.

Lots of brain power at work there. Lots of bets on the table. Most won't work. Some will. Deciding right now which one will work is an uninformed position. Your statement that breakthroughs in hydrocarbon extraction technologies and new understandings on how reseroirs operate is somehow "wish-based" is not a well informed position.

Perhaps you can state what truly groundbreaking breakthroughs have been achieved. And put the historical petroleum technology breakthroughs in perspective for us; when was 3D seismology piloted? Directional drilling? What is on the technology whiteboard right now, ready to be piloted? Most of my career has been in R&D, so I recognize brush-stroke references to technology fixes as intended to inspire and provide hope, but hardly the assurances needed to avoid the plunge down the backside of Hubbert's curve.

I don't think anyone has stated 'which one will work'. We certainly know the downsides of liquid hydrocarbons, however, and have no issues pointing them out.

I will put together the statistics to show that this industry is getting better at drilling and producing hydrocarbons. You might also want to normalize the oil production with the gas production charts and have a BTU production chart, which is more telling anyway.

Yes, please produce such a chart for North America! You'll have an interested audience (though you'll see such in several forms on TheOilDrum) such as the following Saudi chart;

As such, resource allocations shift, and they do so naturally. You might ask yourself why this is so challenging to your worldview?

Naturally? With 100 years of petroleum infrastructure in place and auto fleets that last an average of 18 years, how long do you think it will take to 'naturally' transition to another fuel source? And what would that fuel source be? Or do we just wait for the magic to occur?

Happy New Years

[vfr]

why would anyone want peakoil to happen? Just think at all the hardship which will come when we reach the peak.

Unfortunately its not important what we want.

I't will happen regardless if we want it or not ...

Yes, I'm with ya. Why would anyone want to see our drug run out?

I voted NO.

With me I'm an energy whore. All my stuff burns fossil fuel...from jet skis to dirt bikes to gas powered skateboards.

Even if I want to go green it take gas to go kayaking, skiboarding or rock climbing.

We got other problems right in line with peak oil. We got peak water, peak food, peak uranium and peak NG to name a few.

Have you ever thought about how much of our life is dependent on natural gas for cooking, heating and hot water?

How many of our homes are set up for efficient heating with natural methods such as wood, pellet, passive solar?

My house is not.

I never gave this subject any thought until I learned about peak natural gas. And by then it was too late.

My house is as far as it can be from the 'ideal house' that can be heated my natural methods. And to make maters worse, I live in the NE US, where it gets plenty cold.

Do you know that much of your life is dependent on natural gas outside its use as an energy source?

We will run out of natural gas, just as we deplete our crude supplies in the near future.

http://www.amazon.com/High-Noon-Natural ... 1931498539

Natural gas is a raw material in many of our products we depend on.

Almost all the helium we produce comes from natural gas.

Propane, synthetic fertilizers, ammonia?

They are totally dependent on natural gas.

Our population boom was fueled by synthetic fertilizers made from natural; gas. Once the gas dries up so does the fertilizer and a shortage of fertilizer equals a shortage of food.

Natural; gas is also used as an energy source to produce steel, glass, paper, clothing, brick, electricity

http://www.enotes.com/how-products-ency ... atural-gas

http://www.ipm.iastate.edu/ipm/icm/2003 ... tgasn.html

http://www.eia.doe.gov/kids/energyfacts ... TISUSEDFOR

You still have some valuable time left to prepare for what awaits you down the road.

We are in the 'Indian Summer' of a carbon based world. Don't wait until the winter sets in to start work on your preparedness efforts.






Take care,


V (Male)

Agnostic Freethinker
Practical Philosopher
Futurist
Urban Homesteader

[OilmanChoke]

The most interesting breakthroughs are in rock physics and better quantifying and inducing fracturing. 3-D seismic technology was good for what it was, but in the end, it was an efficiency tool that allowed us to better exploit old fields and to scrape up the small reservoirs that were "aliased" in 2-D seismology.

Oil and gas reservoirs were thought to be trapped in structural traps and stratigraphic traps. Seismology provided us with a great tool to exploit structural traps. The mid-size to small strat traps are still left to be found. If that was all there was, I would say you are dead on correct. Simmons' authoritive guesses at the super major reservoirs looks correct, and replacing this production won't be easy. It certainly won't be done with lifting costs of $0.50 per barrel like these big boys.

However, your discourse on the oil sands is right on... yes, it isn't profitable until you have steady $30 per barrel of oil or better. Massively more expensive than $0.50 per barrel crude found 100 years ago, but still much less than the alternative.

The Non-Traditional reserves we are finding, of which the Bakken Shale is one, the Wolfberry play in West Texas another, the Barnett Shale in North Texas, all the Anadarko basin,, the Woodford Shale, and on and on are proving to be massive resources, and the ones named, rapidly turning into reserves, because they are really economic at $30 per barrel as well. The key technology for all of these is induced fracturing. Our old methods were just as likely to damage the reservoir than to help open them. These resources are trillions of barrels in size.

So, the energy does not reach your panacea of non-pollutive, but what does? The answer is "nothing". Everything is impactful and everything has non-rationalized costs on one level or another.

As you saw on the blog, it said it was Part 1. Don't you think it disingenuous to say I cherry picked? There was a lot of interesting things said in those surveys, don't you think? Of course, if a survey was "turned down by Science", then how was it illigitimate?

Again, really surprised and fascinated by the amount of invective on this board towards my comments. Seems a bit.... closed minded. Dang, I apologized for calling Sustainability wacky already. I can't wait to hear your thoughts on the other part of this equation... human population growth and your proposed solutions for that.

[JohnDenver]

synthetic fertilizers, ammonia?

They are totally dependent on natural gas.

Our population boom was fueled by synthetic fertilizers made from natural; gas. Once the gas dries up so does the fertilizer and a shortage of fertilizer equals a shortage of food.

Sorry, but the above statement is 100% wrong.

China is the largest producer of nitrogen fertilizer:


And: "60% of China's nitrogen fertilizer production is currently based on coal." Source

Furthermore, nitrogen fertilizer can be produced without any fossil fuel at all, using hydroelectricity, wind or nuclear power. Nitrogen comes from the air, not from natural gas. For details, see:
PEAK OIL AND FERTILIZER: NO PROBLEM

Please inform yourself better so that you don't perpetuate lies.

[Oil-Finder]

Bit of a gamble, then. Much as skyemoor said.

No denying the Bakken is profitable. We're just figuring it into the global picture - how much it can really mitigate things. 50kbpd doesn't really stand up too much next to those megaprojects. You'd need 10 Elm Coulees to even register much, and even with their longevity if we're going to maintain supply for the country those wells need to be drilled soon. It's like a microcosm of the US, where we're the third largest producer in the world - with over half a million wells, orders of magnitude more than the rest. That'll take a while to drill all those holes.

Well, as I said it won't be for another 10-20 years until this play starts measuring some serious output. You can't expect them to drill thousands of wells overnight. They've only figured out how to play this formation successfully recently, and only figured out it's got lots of oil recently. Can't do much about the history of this play, can we.

[JohnDenver]

Again, really surprised and fascinated by the amount of invective on this board towards my comments.

Skyemoor and the other peak oilies talk a good game about sustainability and GHG's etc., but it's mostly just rank hypocrisy like Al Gore. They're all living gas-guzzling lifestyles, and investing in oil stocks etc. What kind of car do you drive Skyemoor?

Of course this is just a reflection of the value system of people all over the world, and when you present it as a stark choice:
A) Keep driving and enjoying the eazy lifestyle
B) Stop emission of GHGs and save the polar bears
We know exactly which option Joe Sixpack is going to choose.

[P.S.: Welcome to the forum! ]

[Oil-Finder]

First: This topic "DO You Want It To Occur" is exactly the right question. Why would you WANT this to occur unless you are bigoted against hydrocarbons?

I'm glad someone liked my question.

By the way, I was the source for the Bakken versus State Waters post. Bakken wells are all over the place. I just drilled a dry Bakken well. Like all reservoirs, they have a log normal per well productivity distribution. That is why this is a "statistical play". They also decline. The 3 wells example was meant to illustrate how you can get an obscene amount of mezzanine financing with relatively little cash flow and a great acreage position, and how you shouldn't let the idea of your finacing costs being higher than your IRR per well get in the way. Your goal is to drill as many wells as you can in your acreage to define the maximum number of proven undeveloped locations... and no more. The PUDS have a significant value and will dwarf your proven producing reserves in value when flipped to someone with lower costs of capital. Here are the links to the posts that set up the Bakken post, and a follow up on divestiture of assets in a Bakken-like play. That these plays are being opened up all around us is no fluke. We are truly finding world class oilfields and gasfields "hidden" within our existing basins in rocks we thought wouldn't produce economically. There are several basins we know have a hydrocarbon system that have never had good reservoir rocks we are evaluating as an industry right now. Domestic new field discoveries are in the "b"illions of barrels again, just like in the 1950's. Of course, these wells aren't Saudi Arabia good or Iran good, but they sure as hell are $60+ dollars per barrel good.

http://openchoke.blogs.com/open_choke/2 ... il_bu.html

http://openchoke.blogs.com/open_choke/2 ... _bu_1.html

http://openchoke.blogs.com/open_choke/2 ... d-gas.html

Thank you for that insightful post from someone who actually works in the industry.

[Oil-Finder]

2. The author/authors state "The methods used by Price to determine the amount of hydrocarbons generated by the Bakken are different from the traditional petroleum geochemical practices and are under dispute."

Here are the complete technical papers by Leigh Price:
http://www.undeerc.org/price/

You can find more here - this is some of the work by 2 of the other geologists mentioned in the state of ND piece:
http://www.searchanddiscovery.net/docum ... /index.htm

Linking Price's paper, or one with an Exxon/Mobil engineer, does nothing to show that his methods and findings are not under dispute.

Don't like the message, so blame the messenger.

One of those 2 geologists does not work for an oil company.

A regular journalist quoting oil execs and bankers having "large land positions" in the Bakken formation. Hardly anything to hang one's hat on.

Yes, and we know that peak oil theorists who hate hydrocarbon fuels are reliable sources of information, too.

If you can find something from a reliable source, we'll look at it.

https://www.dmr.nd.gov/ndgs/newsletter/ ... mation.pdf
Page 5:

"The per well cost is approximate $2.2 million with the potential for the well to produce 500 to 700 BOPD initially, leveling off at 250 BOPD with virtually no water.

Now, I notice you also stated;

The reason why estimates of URR are all over the place is because no one really knows.

And one of your references also state;

But how much of the Bakken oil in place is recoverable using today's technology? Based on conventional production methods, perhaps only 10 per cent. But horizontal drilling, combined with a new production technique, known as hydraulic fracturing, has increased recovery rates by another five per cent.

and another of your references

... science places the oil potential of the Bakken between 10 and 400 billion barrels of oil

So perhaps as much as 15% recovery of 10 to 400 billion barrels after drilling, by your estimate, 10s of thousands of wells, which in this era of old, rusty equipment, low inventory levels, high percentages of skilled oilfield workers at retirement age, and complicated fracturing methods, you claim prices for each well could be $2 million. Suffice to say, this provides us with little, if any, confidence in your claims that such shaky evidence can dissuade us from concerns over economic impacts from doubtful future petroleum production levels.

I love the way you cherry-pick your data to attempt to make your case.

Maybe if I link and highlight this ten more times people will finally get it:
http://www.nd.gov/ndic/ic-press/bakken-form-06.pdf
^
Page 2:
"How much of the generated oil is recoverable remains to be determined. Estimates of 50%, 18%, and 3 to 10% have been published."

Nobody knows how much is recoverable. Your 15% is not cast in stone, as you seem to believe.

One oil company on the Canadian side of the play seems to think it will be much more than 15%:
http://www.canada.com/edmontonjournal/n ... 24830e&p=2
^
"While current technology will be able to extract about 15 per cent of the oil in place, Smith believes new techniques will be able to increase recovery rates well beyond that."
.

[JohnDenver]

The top 3 elephant fields in the world (with EROEI ratios of 1:30) are now in decline (at rates of up to 15% per year)

What rate is the number 1 elephant field in the world currently declining at? (BTW, love the "up to 15% per year". Reminds me of those shady discount stores advertising "up to 15% OFF".)

[TheDude]

Re: fertilizers: Pimentel's study of 2005 concluded that organic farming sans fertilizers can be just as productive as industrial ag.

JD, you are correct that China uses 60% or 65% (I've seen that higher number too) coal for fertilizer. It's just that NG is more efficient, as the table underneath the graph you posted shows (illustrating usage in West Europe)

West Europe Natural Gas Heavy Oil Coal

Energy consumption 1.0 1.3 1.7

OilmanChoke - your blog mentioned a 95% success rate for wells in the Bakken. Is drilling really that sure fire, and how does it compare to those other unconventional plays you listed?

Re: Clathrates, I've heard them dismissed as uneconomical - it'd be easier to just open up pockets of stranded gas and build LNG terminals. Bit like cellulosic ethanol or fusion - looks very promising but who knows if it'll pan out. My other bugaboo with methane hydrates is that they're a prime culprit in the greatest mass extinctions in Earth's history. Make a killing, sure, but you're not going to wipe out 95% of life on the planet! Call me a nutty statist.

GW might trigger them in the end anyway. I am in favor of worldwide sanctions on power plant/vehicle emissions - why this should be contrary to the need to make a buck I'm not sure...

Found a very interesting piece on corporate efficiency makeovers, like the switch away from CHFCs; in each case the studies (both government, academic, private) overstated the costs of conversion, sometimes by a great deal. It was done by a guy currently on the staff of Lewis and Clark College, didn't bookmark it but will try to fish it out.