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Peak Permian means Global Peak Oil will happen in 2020

General discussions of the systemic, societal and civilisational effects of depletion.

Re: Peak Permian means Global Peak Oil will happen in 2020

Unread postby rockdoc123 » Thu 22 Feb 2018, 19:04:45

local clay? Hahahahaha! You say the funniest things.

If you're after cheap proppant then the cheapest ceramic proppant comes from China! Its manufactured in CHINA using CHINESE CLAY and then SHIPPED SIX THOUSAND MILES ACROSS THE PACIFIC OCEAN AND THROUGH THE PANAMA CANEL TO THE US. Even after all that shipping Chinese proppant is undercutting Carbo Ceramics----the main US manufacturer.


and what is being postulated is that by using a source immediately proximal to on-going fracking the cost for ceramic propant drops considerably. As with all manufacturing once up and running those costs will continue to decrease for sometime. So whereas it might be cheaper to import now those costs do not offset the advantage of sand...what is postulated is that the costs will drop below any other source.

Get it now? :roll:
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Re: Peak Permian means Global Peak Oil will happen in 2020

Unread postby Tanada » Thu 22 Feb 2018, 19:59:30

This does raise the question of just how much fracking are the Chinese doing in their own territories?
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Re: Peak Permian means Global Peak Oil will happen in 2020

Unread postby rockdoc123 » Thu 22 Feb 2018, 21:14:40

This does raise the question of just how much fracking are the Chinese doing in their own territories?


they produced 8 billion cubic metres of gas from shale formations last year. So that is 282 BCF over the year or 772 MMcf/d. If you assume typical average rates from shale wells (mixing together new wells and old wells) of lets say for arguments sake 200 Mcf/d that's around 3900 wells producing. How many are new wells which would require fracking .....not sure there is a way to guess at that.
The Chinese have as a goal 30 billion cubic metres of gas produced from shales as a target so that would be a lot of new fracking.
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Re: Peak Permian means Global Peak Oil will happen in 2020

Unread postby Plantagenet » Thu 22 Feb 2018, 21:47:48

what is being postulated is that by using a source immediately proximal to on-going fracking the cost for ceramic propant drops considerably.


Yes, but back here in the real world the CHINESE are selling their proppant cheaper then US manufacturers can sell their proppant, even though US manufacturers are using clay sources in the US and Chinese manufacturers are using chinese clay and chinese factories and then shipping it thousands of miles to the USA. Chinese proppant prices are so low that some US manufacturers claim the Chinese are selling into the US market at below their production costs to driven the US manufacturers out of business.

carbo-ceo-takes-aim-at-low-price-chinese-proppants

Thats the SECOND time I've had to explain this simple idea to you.

Its a very simple concept. Chinese proppant is cheaper then US proppant.

Do you get it now?

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Re: Peak Permian means Global Peak Oil will happen in 2020

Unread postby rockdoc123 » Thu 22 Feb 2018, 21:56:31

Thats the SECOND time I've had to explain this simple idea to you.

Its a very simple concept. Chinese proppant is cheaper then US proppant


are you really this thick or is it that you never read my post or that of outcast_searcher?
No one was talking about the situation at this minute but rather in the future.
I realize we have to speak extremely slowly with you ...but...the cost for ceramics locally manufactured in the US are dropping (that is well documented)....as sand becomes more expensive due to lack of supply that will allow for further drop in costs associated with manufacture of ceramics. Locating it all in the immediate area of the on-going fracking drops the cost substantially by eliminating transport costs and at some point it will be much lower than importing it from China. It is that simple.

So it doesn't matter if all the ceramics come from China at this point, they won't in the future when sand becomes more expensive.
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Re: Peak Permian means Global Peak Oil will happen in 2020

Unread postby Plantagenet » Thu 22 Feb 2018, 22:48:13

rockdoc123 wrote:No one was talking about the situation at this minute but rather in the future.


I didn't realize you' were a time traveller from the future.

Its very kind of you to share with us all your knowledge of what will happen in the future.

Thanks for that (and for making me laugh out loud again!)

Image
So you're from the future? Wow! And you've travelled back in time to tell us about the price of proppants in the future? A-maz-ing! :lol: :-D :) :P 8)

Cheers!
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Re: Peak Permian means Global Peak Oil will happen in 2020

Unread postby rockdoc123 » Thu 22 Feb 2018, 23:34:33

I didn't realize you' were a time traveller from the future.

Its very kind of you to share with us all your knowledge of what will happen in the future.


Your ridiculous comments here do not somehow make you look intelligent regardless of what you might think. They serve to make you look foolish and it begs the question why you continue to do so?
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Re: Peak Permian means Global Peak Oil will happen in 2020

Unread postby tita » Thu 01 Mar 2018, 05:15:39

I think it's clear that operators increased substantially the initial rate of LTO wells using various techniques (proppants and longer lateral among them). The average IR of a 2017 well can be 50% to 100% higher than 2014. This alone can explain how operators could sustain production with fewer rigs (outside the permian). But it still short to explain the surge in the last months of 2017.

What if operators could sustain initial rates a little bit longer? We know the production rate of LTO wells reach a peak at the first full month of production before depleting in an exponential way. But if you could delay the depletion to the second or third full month of production, you get an instant production surge, as new wells just add production instead of replacing production from legacy wells. This also means that, along with higher IR, you recover the oil in place faster. But if the UOR stays the same, this also means that depletion is also steeper when it begins.

This appears to be what happened in the Bakken:
Image

Of course, this should be taken with caution. Another issue is about the performance of new wells when you take out the benefits of the costlier techniques used to improve initial rates, in this article:
https://www.spe.org/en/jpt/jpt-article-detail/?art=3832
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Re: Peak Permian means Global Peak Oil will happen in 2020

Unread postby rockdoc123 » Thu 01 Mar 2018, 10:08:04

But if the UOR stays the same, this also means that depletion is also steeper when it begins.


I think that might be the trick here. Longer laterals access greate amounts of reservoir which will increase per well EUR. Better completion techniques (propants etc) can increase recovery factor which also will increase EUR.
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Re: Peak Permian means Global Peak Oil will happen in 2020

Unread postby peakoilwhen » Sun 04 Mar 2018, 14:35:13

>Peak Permian means Global Peak Oil will happen in 2020
>Permian

False premise : oil is fossil from ancient Earth.
Wrong assertion : there will be a geo-peak

wrong idea leads to a wrong prediction. Oil is not cretacious, permian, triassic or jurassic or any other age other than recent. Like within the last 10 million years, a lot will be less than a million years old. It seeps out the mantle into the crust and then decomposes.
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Re: Peak Permian means Global Peak Oil will happen in 2020

Unread postby tita » Tue 06 Mar 2018, 13:04:47

Quite an interesting skeptic on current forecasts of shale, Mark Papa, former CEO "EOG" and current CEO of "centennial":
https://www.wsj.com/articles/shale-trai ... 1520257595

Forecasts like the one from IEA that see a US production growth of 3.8 mb/d till 2023, only from shale oil and LNG (shale gas).
Image

Which place the US as the major supply growth in the next 5 years:
Image

Yeah, forecasts... this one looks like it stretched last year trend over the next five years, with some adjustments to stick to the forecasted demand.

At the same time, the IEA warn about underinvestment and depletion:
“But as we’ve highlighted repeatedly, the weak global investment picture remains a source of concern. More investments will be needed to make up for declining oil fields – the world needs to replace 3 mb/d of declines each year, the equivalent of the North Sea – while also meeting robust demand growth.”

With even the word "peak" inside one of the slides:
Image
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Re: Peak Permian means Global Peak Oil will happen in 2020

Unread postby Plantagenet » Sun 01 Apr 2018, 17:19:49

A new chokepoint has developed that is slowing the development of the remaining Permian oil---there's more natural gas mixed in with the oil then anticipated.

a-choke-point-in-the-permian

As the best acreage in the Permian is used up, the remaining oil shale is lower quality and just isn't as prolific in oil production. Here's a sign of that----the amount of NG being produced is going up in current wells and the amount of oil is going down.

It doesn't mean Peak Permian is happening now....but it does mean continuing to grow oil production in the Permian is getting harder and harder. And when oil production stops growing, that will be PEAK PERMIAN.

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Re: Peak Permian means Global Peak Oil will happen in 2020

Unread postby AdamB » Sun 01 Apr 2018, 18:28:21

Plantagenet wrote:It doesn't mean Peak Permian is happening now....but it does mean continuing to grow oil production in the Permian is getting harder and harder. And when oil production stops growing, that will be PEAK PERMIAN.

Cheers!


Sure. Just like there was a peak US back about half a century ago. It was a good one...well...until another came along.

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Peak oil in 2020: And here is why: https://www.youtube.com/watch?v=2b3ttqYDwF0
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Peak Permian means Global Peak Oil coming ca. 2020s

Unread postby Plantagenet » Sun 01 Apr 2018, 20:52:30

AdamB wrote:
Plantagenet wrote:It doesn't mean Peak Permian is happening now....but it does mean continuing to grow oil production in the Permian is getting harder and harder. And when oil production stops growing, that will be PEAK PERMIAN.

Cheers!


Sure. Just like there was a peak US back about half a century ago.


Oil production in the Permian and in the US as a whole now exceeds the level it reached in 1970. That means neither the peak in Permian oil production nor the peak in US oil production occurred in 1970.

Cheers!

Image
1970 was not the peak in US oil production as many still believe. US production now exceeds the 1970 level and is still going up. Eventually it will peak...perhaps ca. 2020-2022.
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Re: Peak Permian means Global Peak Oil will happen in 2020

Unread postby tita » Fri 20 Apr 2018, 02:09:47

Something maybe overlooked in the forecasted growth of US oil production, especially in the Permian, is the infrastructure needed. It's not only the pipelines or the drilling rigs, but also basically trucks to move the huge amount of sands and water needed in the fracking stage, and the roads for these trucks. Rystad Energy raise concerns on these issues.
https://oilprice.com/Energy/Crude-Oil/A ... Shale.html
https://communications.rystadenergy.com ... :C5ViiKCsI
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Re: Peak Permian means Global Peak Oil will happen in 2020

Unread postby Outcast_Searcher » Fri 20 Apr 2018, 12:08:47

tita wrote:Something maybe overlooked in the forecasted growth of US oil production, especially in the Permian, is the infrastructure needed. It's not only the pipelines or the drilling rigs, but also basically trucks to move the huge amount of sands and water needed in the fracking stage, and the roads for these trucks. Rystad Energy raise concerns on these issues.
https://oilprice.com/Energy/Crude-Oil/A ... Shale.html
https://communications.rystadenergy.com ... :C5ViiKCsI

As usual, it's about money. If global demand for oil keeps growing apace and the overall supply is constrained re the lack of production and new discoveries mentioned recently, then the price of oil will rise as it becomes more obvious that shortages are the risk. Rising prices provide the incentive to invest more and have a shot at reaping serious profits.

Same as it ever was.

For all its flaws, capitalism regulates the flow of self-interested capital better than any pile of government "leaders" could ever hope to.

It produces an ugly, bumpy, risky market, but over time, the market works rather well overall, despite the constant proclaimations of imminent doom (because things aren't ideal).

Such constraints are actually a good thing -- or the market would have even larger and more frequent booms and busts.

Oh, and if the constraints result in high enough prices they cause people to conserve more and burn less, well:

1). That's better for the planet.
2). That should help alternatives like BEV's and PHEV's gain more market share quicker.
3). And clearly, this would be another example of the markets/capitalism working, by adjusting to the reality of market pricing signals.
Given the track record of the perma-doomer blogs, I wouldn't bet a fast crash doomer's money on their predictions.
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Re: Peak Permian means Global Peak Oil will happen in 2020

Unread postby Darian S » Fri 20 Apr 2018, 23:29:43

Outcast_Searcher wrote:
tita wrote:Something maybe overlooked in the forecasted growth of US oil production, especially in the Permian, is the infrastructure needed. It's not only the pipelines or the drilling rigs, but also basically trucks to move the huge amount of sands and water needed in the fracking stage, and the roads for these trucks. Rystad Energy raise concerns on these issues.
https://oilprice.com/Energy/Crude-Oil/A ... Shale.html
https://communications.rystadenergy.com ... :C5ViiKCsI

As usual, it's about money. If global demand for oil keeps growing apace and the overall supply is constrained re the lack of production and new discoveries mentioned recently, then the price of oil will rise as it becomes more obvious that shortages are the risk. Rising prices provide the incentive to invest more and have a shot at reaping serious profits.

Same as it ever was.

For all its flaws, capitalism regulates the flow of self-interested capital better than any pile of government "leaders" could ever hope to.

It produces an ugly, bumpy, risky market, but over time, the market works rather well overall, despite the constant proclaimations of imminent doom (because things aren't ideal).

Such constraints are actually a good thing -- or the market would have even larger and more frequent booms and busts.

Oh, and if the constraints result in high enough prices they cause people to conserve more and burn less, well:

1). That's better for the planet.
2). That should help alternatives like BEV's and PHEV's gain more market share quicker.
3). And clearly, this would be another example of the markets/capitalism working, by adjusting to the reality of market pricing signals.


The rumor is the economy cannot handle significantly higher prices. Word is that will result in demand destruction, so price cannot get too high, and cannot remain at a too high a level for indefinite periods either.
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Re: Peak Permian means Global Peak Oil will happen in 2020

Unread postby Tanada » Sat 21 Apr 2018, 09:47:05

Darian S wrote:The rumor is the economy cannot handle significantly higher prices. Word is that will result in demand destruction, so price cannot get too high, and cannot remain at a too high a level for indefinite periods either.


Just where do you set the benchmark for too high? That is the real issue is it not? While the USA and EU were struggling when Oil was $100+/bbl to a certain extent the Asian powerhouse countries of China, India and yes even Indonesia and Thailand and Vietnam were chugging along just fine and increasing world demand even as USA/EU demand was falling significantly.

In the 1978-80 crash in oil demand in the USA/EU due to the Iran/Iraq war and prices that resulted from that conflict world demand went down because the countries there were the ones most effected economically. But in those days the USA/EU were the bulk of the world economic trading system while the USSR/Warsaw Pact were a separate Second World economically independent of the First World. When the 2005-2008 run up in prices took place as the cheap old fields were unable to meet the new demand from Asia the "First World" had economic problems just like we had in the late 1970's. The USA and EU specifically underwent a significant decline in demand following the same pattern as we had seen in the past. However at the same time demand was growing so rapidly in Asia with small additions elsewhere that as the EU and then USA decreased oil use every drop not consumed in our regions still found buyers even though the price was significantly elevated over the 1986-2004 averages. So this time when 'First World' demand went down significantly that 'loss' in demand was compensated for completely by Asia and as a result while world demand dipped slightly at first it was back to growth quickly and we have since exceeded world demand of 2005 significantly.

I see no reason why even if the USA/EU go back into the economic doldrums as prices head back into the $100/bbl territory for this to stop being true in 2018-2020, and economic projections further than that are pure speculation.

So I repeat, just how high would/will prices have to reach to impact Asian demand growth? Because that region is now the world economic powerhouse, not the USA/EU as it was last century, or the British Empire as it was the century before that.
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Re: Peak Permian means Global Peak Oil will happen in 2020

Unread postby Darian S » Mon 23 Apr 2018, 00:13:19

At least china has artificially massaged their economy. And from what I hear debt has been skyrocketing globally in the recent past.

Global debt has grown by $57 trillion in seven years following the financial crisis

Global debt has increased by $57 trillion in the seven years following the financial crisis, according to a new report, while China’s debt as a share of GDP now stands at higher than that of the US-theguardian
Many economists are particularly concerned about the situation in China, where corporate bank-borrowing has exploded since the global financial crisis. -independent


You can temporarily increase demand for a short while by borrowing against the future, but it is unsustainable. Physics, energy, it underlies the economy, debt cannot drive the economy, real physical activity requires energy at every step, you can camouflage the situation for a while, but inevitability will catch up to you.
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Re: Peak Permian means Global Peak Oil will happen in 2020

Unread postby ROCKMAN » Mon 23 Apr 2018, 11:14:13

Darian - "You can temporarily increase demand for a short while by borrowing against the future, but it is unsustainable." And thus the perpetual problem of using short term trends (a year or 3) to predict long term trends (5 to 10 years). The lag times are just to difficult to factor into the dynamics.
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