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The Biggest Problem Behind The US Shale Boom

Production

U.S. shale production is expected to continue to soar well into the 2020s. And that is a major problem.

Over the past decade, U.S. oil production has more than doubled, surging from 5 million barrels per day (mb/d) to close to 12 mb/d today. Natural gas also rose significantly, rising from 21 trillion cubic feet per year (Tcf/y) in 2008 to 29 Tcf/y in 2017.

Natural gas has been likened to a “bridge fuel,” allowing the U.S. to lower greenhouse gas emissions (GHG) while it transitions to cleaner energy. Cheap shale gas has killed off a lot of coal plants, and with a GHG-profile half that of coal, the switch has been a boon for the fight against climate change.

That narrative, to be sure, remains up for debate. Shale gas operations emit methane, and at some point high volumes of fugitive methane emissions completely offset the benefit that gas has over coal. Various studies, for and against, argue over exactly how much methane is and has been emitted.

But there are other reasons why the coal-to-gas narrative has been oversold. Billions of dollars of investment in gas drilling and gas-fired power plants sucks capital away from renewable energy. Cheap shale gas has also killed off nuclear power, the largest source of carbon-free electricity.

More to the point, new power plants are long-lived investments, and their owners expect to be using them for decades to come. In other words, the U.S. has been locking itself into gas, even though the science dictates a relatively short timetable for the energy transition.

Still, knocking off coal does have its benefits, and the case against gas isn’t exactly clear cut.

However, what about crude oil? The surge in oil production in the U.S. and the resulting impact on greenhouse gas emissions has not been studied all that much. A new report from Daniel Raimi of Resources For the Future (RFF) studies the impact on GHG emissions from a variety of future oil production situations. Raimi is the author of the very even-handed book, “The Fracking Debate.”

 

Raimi laid out several scenarios looking at the GHG impact of U.S. oil and gas production (higher or lower production; more or less stringent climate policies; assumptions about methane) and found that GHG emissions are the highest in all scenarios in which the U.S produces more oil relative to the EIA’s baseline reference case.

Notably, even climate policy was outweighed by the precise level of oil and gas production. The Obama administration’s Clean Power Plan, which required a significant overhaul of the electricity sector and would have shut down a number of coal-fired power plants, was a landmark policy and one of the most significant efforts by the government to accelerate the energy transition. The CPP was stayed by the Supreme Court and is being replaced by the Trump administration.

However, according to Raimi’s study, even if we assume the full implementation of the CPP, emissions are still higher in the “high oil production” scenario, even when compared to the no CPP but lower oil and gas production.

“In other words, low levels of oil and natural gas production do more to reduce emissions than implementation of the CPP,” Raimi concluded, noting that the only caveat that undercuts this conclusion is if methane estimates have been vastly overstated.

The conclusion is worth repeating. The Obama-era CPP – President Obama’s signature climate policy, and the one at the core of the U.S.’ participation in the Paris Climate Agreement – is of less consequence to GHG emissions than the precise level of oil and gas production.

Put another way, the climate penalty in an aggressive scenario in which U.S. shale production continues to rise over the next decade more than offsets the benefit of shutting down a bunch of coal plants.

The main reason for this is not CO2, but methane. It’s not people burning more gasoline in their cars because of higher oil production. Demand is relatively inelastic in the U.S.

Instead, the major climate penalty comes from higher methane emissions associated with upstream production. CO2 emissions remain enormous and a massive problem to tackle, but these emissions don’t change all that much. Methane emissions inordinately jump relative to the reference case if oil and gas production exceeds the baseline.

“Under a scenario with high levels of oil and natural gas production, increased methane emissions are likely to swamp the GHG effects of policies such as the CPP unless methane emissions are dramatically reduced below current levels,” Raimi warned.

Meanwhile, higher U.S. oil production has global effects, lowering prices and boosting demand. The effects are more difficult to tease out, but by 2030, the world could consume 1.6 mb/d more than it otherwise would under the high U.S. production scenario. U.S. oil is exported abroad, lowering prices and boosting demand.

The world then ends up emitting 200 to 50 MMT of CO2 more than it otherwise would, according to RFF. For context, Brazil emitted 417 MMT in 2016. In other words, higher U.S. oil and gas production could add another Brazil’s-worth of greenhouse gases by 2030.

There are plenty of uncertainties and assumptions built into any model, and that needs to be kept in mind. But the RFF study offers a stark warning. In short, the ongoing U.S. shale bonanza is calamitous for the fight against climate change.

A report last month from Oil Change International was more direct. The U.S. oil and gas industry “is gearing up to unleash the largest burst of new carbon emissions in the world between now and 2050.”

By Nick Cunningham of Oilprice.com



25 Comments on "The Biggest Problem Behind The US Shale Boom"

  1. Pete Bauer on Tue, 19th Feb 2019 7:52 pm 

    Despite all the talk of cheap oil, the combustion engine vehicle sales has gone down in World top-3 markets last year (China, Europe & USA). This will further accelerate this year as the ICE vehicle sales in China has dropped by more than 17% last month while the electric vehicle sales increased by 140%.

    Cunning big oil has taken over natgas companies and they are trying to kill coal.

    https://cleantechnica.com/2019/02/16/fossil-vehicle-sales-are-officially-now-decreasing-in-china-europe-us/

  2. Sissyfuss on Tue, 19th Feb 2019 10:28 pm 

    We’re going to dig it up, we’re going to burn it, and we’re going to cook the Earth. It’s what we do.

  3. makati1 on Wed, 20th Feb 2019 12:55 am 

    Pete… and you point is? Total world FF car sales last year was about 78,000,000. Total EVs sold last year were about 2,000,000.

    140% of 2 million is just 2.8 million. Big deal. And you only talk about China’s car numbers, but they are only about 1/3 of world wide car sales, so, a 17% drop is only about 7% of world wide sales of FF cars.

    https://www.statista.com/statistics/200002/international-car-sales-since-1990/
    http://www.ev-volumes.com/country/total-world-plug-in-vehicle-volumes/

    Come back when the numbers are reversed and there are only 3 million FF cars sold and about 78 million EVs sold per year ………. I’m waiting ……… Hmm. I think Hell will freeze over first. LOL

  4. Free Speech Forum on Wed, 20th Feb 2019 5:01 am 

    The elites laugh when the 99% are divided.

  5. Robert Inget on Wed, 20th Feb 2019 5:28 am 

    CARACAS (Reuters) – A fire hit a crude oil pumping station in Venezuela’s Orinoco belt region on Tuesday, state-owned oil company Petroleos de Venezuela (PDVSA) said, disrupting crude transportation as the cash-strapped firm struggles with the impact of U.S. sanctions.

    The fire at the Ero pumping station, which has the capacity to transport 300,000 barrels per day of crude, was controlled and no one was injured, the company said in a statement. But the incident will affect transport of crude through pipelines, a source at the company said, without providing further details.

    The incident comes weeks after the United States slapped sanctions on PDVSA to try to oust socialist President Nicolas Maduro from power. Venezuela, a founding member of the Organization of the Petroleum Exporting Countries (OPEC), holds the world’s largest crude reserves, but production has collapsed amid mismanagement and an economic crisis.

    https://www.reuters.com/article/us-venezuela-oil-fire/fire-hits-pdvsa-pumping-station-disrupting-venezuela-crude-transport-idUSKCN1Q90A3

  6. Uncle Bill on Wed, 20th Feb 2019 7:03 am 

    The Human cancer continues unabated…
    Great going Guys! thanks…looks like I may have a retirement

  7. Antius on Wed, 20th Feb 2019 7:49 am 

    Interesting extract from ‘Without Hot Air’ written by the late David McKay, talking about the uselessness of roof mounted wind turbines in urban environments. This assessment is quite relevant to what I am working on at present:

    ‘In a typical urban location in England, microturbines deliver 0.2 kWh per day. Source: Third Interim Report, http://www.warwickwindtrials.org.uk/2.html. Among the best results in the Warwick Wind Trials study is a Windsave WS1000 (a 1-kW machine) in Daventry mounted at a height of 15m above the ground, generating 0.6 kWh/d on average. But some microturbines deliver only 0.05 kWh per day – Source: Donnachadh McCarthy: “My carbonfree year,” The Independent, December 2007 [6oc3ja]. The Windsave WS1000 wind turbine, sold across England in B&Q’s shops, won an Eco-Bollocks award from Housebuilder’s Bible author Mark Brinkley: “Come on, it’s time to admit that the roof-mounted wind turbine industry is a complete fiasco. Good money is being thrown at an invention that doesn’t work. This is the Sinclair C5 of the Noughties.” [5soql2]. The Met Office and Carbon Trust published a report in July 2008 [6g2jm5], which estimates that, if small-scale turbines were installed at all houses where economical in the UK, they would generate in total roughly 0.7 kWh/d/p. They advise that roof-mounted turbines in towns are usually worse than useless: “in many urban situations, roof-mounted turbines may not pay back the carbon emitted during their production, installation and operation.”…’

    The devices described have long energy payback times, due to the high embodied energy in the devices and the low wind speeds in urban areas. Due to lower wind speeds close to the ground, small wind turbines always show poorer EROI than larger systems.

    The solution to this problem always focuses on the development of larger turbines, with peak power production measured in MW and often located offshore where wind speeds are higher. Yet, another potential solution is never discussed: reducing the embodied energy of the device. This is exactly the solution that I am attempting to pursue in the design of my home workshop. This can be done for example, by constructing very simple vertical axis wind machines out of low embodied energy materials, like wood, and using the machines to produce direct mechanical power rather than electrical energy. At a stroke, this eliminates all of the embodied energy associated with the electrical system and enormously simplifies the device. The device itself is very simple and easy to build: a set of blades connected to a hub, which transmits power to machinery via a simple rotating shaft.

    The device that I am designing is intended to power wood and metal working equipment within a workshop. In order to do this, the vertical shaft from the VAWT transfers power to a rotating horizontal shaft via a bevel gear. The horizontal shaft passes through the workshop at ceiling level. Power is transferred to individual machines through a series of disc clutches, allowing each machine to draw power directly from the single ceiling mounted shaft. Each machine has different requirements in terms of power, torque and rotational speed. Different speed requirements are met by either gearing between the clutch and machine or through the use of belts, which adjust rotational speed for small power devices.

    Given that wind speeds are highly variable, there will be days during which the power provided by wind is insufficient to run energy hungry equipment like lathes, band saws and milling machines. A wind powered workshop requires careful scheduling of work, so that high demand devices are used intensively on windy days and low power operations are carried out at less windy times. In addition, there will be periods when the workshop is not in use and power could potentially be wasted. This problem can be eliminated by including shunt loads that run semi continuously. These include a chest freezer; a mill for grinding grains and rock dust; a water pump and a mechanical washing machine. Shunt loads can be disconnected during workshop operations and reconnected afterwards.

    I still have about 18 months before I move, which is hopefully enough time to settle the details.

  8. Uncle Bill on Wed, 20th Feb 2019 11:13 am 

    Antius that is fascinating…keep us all updated on your progress and details on your designs. This is important

  9. Cloggie on Wed, 20th Feb 2019 11:35 am 

    As Antius suggests, small wind turbines have very small (as in: terrible) returns:

    https://www.duurzame-energiebronnen.nl/subsidie-windenergie.php

    Few dimes to few euro’s per kWh.

    Please, don’t.
    It’s a gimmick for Don Quixote’s.

  10. Davy on Wed, 20th Feb 2019 11:55 am 

    Clogg, I went with 6 more panels over a small wind turbine. The numbers don’t pan out. I have a great spot for wind also.

  11. Antius on Wed, 20th Feb 2019 12:35 pm 

    Cloggie, I don’t doubt the truth of what you are saying, but the link that you post is for wind-electric generators, with capital costs of tens of thousands of Euro’s, for systems that generate about 1kWh per day. I am not surprised that they are cripplingly expensive.

    What I am looking at is something substantially simpler – a homemade, purely mechanical system that drives machinery directly, without any additional energy transitions. Aside from the possible exception of bearings and gears; all of the components will be made from wood and other recycled materials and I can design and build the system myself. This cuts out all of the capital costs of a complex engineered system and avoids a substantial source of energy loss as well. This article from Kris De Decker concerns small scale hydropower.

    https://www.lowtechmagazine.com/2013/08/direct-hydropower.html

    Small-scale hydroelectric is highly inefficient, for many of the same reasons that small scale wind is inefficient.

    ‘A home-sized hydropower plant generating AC electric power has a “water-to-wire” energy transfer of at best 60 to 70 percent. [3] Smaller DC electric systems, which require inverters and generally have battery banks, have lower efficiencies of 40 to 60 percent. [3]’

    The generator on the turbine and the electric motor on machinery, both represent significant embodied energy, in addition to an unnecessary set of energy transitions. What embodied energy assessments typically miss is that human labour invested in a complex device is also a huge energy investment. This is because the men employed in the design, build and marketing of complex products, are all energy consumers and their consumption is entirely funded by their jobs.

    It may turn out that what I am looking at is not sustainable, but I do intend to explore the concept.

  12. Cloggie on Wed, 20th Feb 2019 12:53 pm 

    but the link that you post is for wind-electric generators

    I know. Your post consisted of two separate parts:

    – MacKay’s statement about (electrical) micro-turbines
    – Your home craft project

    My link was posted to illustrate MacKay’s point.

    I don’t care that much about small scale.

    I’m more interested in GW-scale projects with massive geopolitical clout with which we Europeans can beat the US.lol

    https://www.youtube.com/watch?v=mdls9UUlCPc

  13. Cloggie on Wed, 20th Feb 2019 12:56 pm 

    Offshore wind latest:

    https://deepresource.wordpress.com/2019/02/20/installation-aeolus-1600-ton-crane/

    “Huisman Installation Aeolus 1600 Ton Crane”

    https://deepresource.wordpress.com/2019/02/20/new-deme-jackup-ship-apollo-to-be-inaugurated-tomorrow/

    “New DEME Jackup Ship Apollo to be Inaugurated Tomorrow”

    https://deepresource.wordpress.com/2019/02/20/kick-off-building-nexans-aurora-submarine-cable-layer/

    “Kick-off Building Nexans Aurora Submarine Cable Layer”

    https://deepresource.wordpress.com/2019/02/20/worlds-largest-chinese-jackup-vessel-with-2000-ton/

    “World’s Largest Chinese Jackup Vessel With 2000 Ton”

    https://deepresource.wordpress.com/2019/02/20/1600-ton-offshore-wind-monopiles-in-china/

    “1600 Ton Offshore Wind Monopiles in China”

  14. Robert Inget on Thu, 21st Feb 2019 8:03 am 

    March drilling repore;
    https://www.eia.gov/petroleum/drilling/#tabs-summary-2

    They say, total new shale oil produced in March will be 628,526 barrels per day. (Net inc+Legacy decline)
    Net Increase will be 84,406 barrels per day.
    Legacy Decline will be 544,119 barrels per day
    Therefore for every 1 barrel per day increase, 7.45 barrels of new oil had to be produced.

  15. Robert Inget on Thu, 21st Feb 2019 8:15 am 

    Nigeria demands Back Taxes from oil majors;

    https://www.reuters.com/article/us-nigeria-oil-debt-exclusive/exclusive-nigeria-hits-oil-majors-with-billions-in-back-taxes-idUSKCN1QA1EK

    In a letter sent to the companies earlier this year via a debt-collection arm of the government, Nigerian National Petroleum Corp (NNPC) cited what it called outstanding royalties and taxes for oil and gas production.

    Royal Dutch Shell, Chevron, Exxon Mobil, Eni, Total and Equinor were each asked to pay the central government between $2.5 billion and $5 billion, said the sources, who saw or were briefed on the letters.

    two hours old

  16. Robert Inget on Thu, 21st Feb 2019 9:05 am 

    Imports down, consumption higher, and yet
    oil “down” to mid fifties.

    Summary of Weekly Petroleum Data for the week ending February 8, 2019
    U.S. crude oil refinery inputs averaged 15.8 million barrels per day during the week
    ending February 8, 2019, which was 865,000 barrels per day less than the previous
    week’s average. Refineries operated at 85.9% of their operable capacity last week.
    Gasoline production decreased last week, averaging 9.6 million barrels per day. Distillate
    fuel production decreased last week, averaging 4.8 million barrels per day.

    U.S. crude oil imports averaged 6.2 million barrels per day last week, down by 936,000
    barrels per day from the previous week. Over the past four weeks, crude oil imports
    averaged about 7.2 million barrels per day, 11.2% less than the same four-week period
    last year. Total motor gasoline imports (including both finished gasoline and gasoline
    blending components) last week averaged 457,000 barrels per day, and distillate fuel
    imports averaged 438,000 barrels per day.
    U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum
    Reserve) increased by 3.6 million barrels from the previous week. At 450.8 million
    barrels, U.S. crude oil inventories are about 6% above the five year average for this time
    of year. Total motor gasoline inventories increased by 0.4 million barrels last week and
    are about 4% above the five year average for this time of year. Finished gasoline
    inventories increased while blending components inventories decreased last week.

    Distillate fuel inventories increased by 1.2 million barrels last week and are about 2%
    below the five year average for this time of year. Propane/propylene inventories
    increased by 0.7 million barrels last week and are about 11% above the five year average
    for this time of year. Total commercial petroleum inventories increased last week by 6.5
    million barrels last week.

    Total products supplied over the last four-week period averaged 20.8 million barrels per
    day, up by 0.6% from the same period last year. Over the past four weeks, motor gasoline
    product supplied averaged 9.0 million barrels per day, up by 0.7% from the same period
    last year. Distillate fuel product supplied averaged 4.3 million barrels per day over the
    past four weeks, up by 6.5% from the same period last year. Jet fuel product supplied was
    up 1.2% compared with the same four-week period last year.

  17. Robert Inget on Thu, 21st Feb 2019 9:19 am 

    Are all foods the same?
    Grades of oil also differ greatly. This recent Bloomberg article may explain.

    (Bloomberg) — They are slowly plowing their way across thousands of miles of ocean toward America’s Gulf of Mexico coastline. As they do, twelve empty supertankers are also revealing a few truths about today’s global oil market.

    In normal times, the vessels would be filled with heavy, high sulfur Middle East oil for delivery to refineries in places like Houston or New Orleans. Not now though. They are sailing cargo-less, a practice that vessel owners normally try to avoid because ships earn money by making deliveries.

    The 12 vessels are making voyages of as much as 21,000 miles direct from Asia, all the way around South Africa, holding nothing but seawater for stability because Middle East producers are restricting supplies. Still, America’s booming volumes of light crude must still be exported, and there aren’t enough supertankers in the Atlantic Ocean for the job. So they’re coming empty.

    “What’s driving this is a U.S. oil market that’s looking relatively bearish with domestic production estimates trending higher, and persistent crude oil builds we have seen for the last few weeks,” said Warren Patterson, head of commodities strategy at ING Bank NV in Amsterdam. “At the same time, OPEC cuts are supporting international grades like Brent, creating an export incentive.”

    The U.S. both exports and imports large amounts of crude because the variety it pumps — especially newer supplies from shale formations — is very different from the type that’s found in the Middle East. OPEC members are likely cutting heavier grades while American exports are predominantly lighter, Patterson said.

  18. Robert Inget on Thu, 21st Feb 2019 9:47 am 

    Conclusions;
    With No More Venezuelan (heavy) oil imported to US in 2019, the US faces shortages of diesel.

    That’s it. Simple like borscht.

    Investors buying grains futures will make money.
    Feeding families will become even a greater challenge.

    Canada’s Oil Sands:
    Distillates; diesel, jet fuel, heating oil, will be in shorter supply. Pipelines from Canada currently dancing as fast as they can.
    No hope of expansion for 24 months or longer.
    By 2025 the planet will be so hot working outside in a Persian Gulf summer will be impossible.

  19. rockman on Thu, 21st Feb 2019 10:33 am 

    Been a while since I’ve checked. Sad to see an unfortunate level of ignorance still here. I don’t fault folks for lacking certain knowledge: no one understands every aspect of the world we live in. What irritates are those who try to represent themselves as “experts”.

    “Cunning big oil has taken over natgas companies and they are trying to kill coal.”

    First “big oil” has always been a misrepresentation of the industry. Not a great sin but still misleads the uneducated. It is “big petroleum”…not “big oil”:

    Petroleum, complex mixture of hydrocarbons that occur in Earth in liquid, gaseous, or solid form. The term is often restricted to the liquid form, commonly called crude oil, but, as a technical term, petroleum also includes natural gas and the viscous or solid form known as bitumen, which is found in tar sands.

    The major NG producers in the US includes (and always has) the largest PETROEUM producers:

    The 8 Largest Natural Gas Drillers in the U.S.
    Exxon Mobil. The biggest natural gas producer is also the country’s biggest oil company.
    Chesapeake Energy
    Anadarko
    Devon Energy
    BP
    Encana
    ConocoPhillips
    Southwestern Energy Co.

    If one has paid any attention to the NG boom they would know these produces have developed most of their NG reserves by drilling and not by acquiring other companies. As far as “big oil” trying to kill coal most here know I’ve worked in the industry for more then 4 decades and not once over that entire time I have heard any concern over coal. Not once. In reality, the coal industry doesn’t really exist in the minds of the vast majority of us oil and NG producers. Even in Texas, the largest US coal consumer…2X as much as #2 Indiana. Texas which produces and consumes more NG then any other state. If coal doesn’t negatively impact Texas oil and NG activity I doubt it’s a problem for any other state.

    As far as US shale production increasing GHG I’m sure most here know US consumers will burn as much petroleum whether it’s produced domestically or we import it. IOW our carbon footprint isn’t going to change if we didn’t produce 1 cubic foot of shale NG.

    Again, the reminder: the vast majority of GHG is produced by fossil fuel CONSUMERS…not the producers. And our consumers producer a very disproportionate large share of that GHG. And will continue to do so even if US companies didn’t exist: we would just buy as much as we can from foreign producers.

  20. Schop alsjeblieft de anti-Amerikaanse hond aka fmr-paultard die ik van graniet heb on Thu, 21st Feb 2019 10:57 am 

    welcome back supertard. i don’t know why our supertards are so stuck in technicality and they do this for ego which translate into expertise and power. the whole thing is a power show and i don’t like the hard core power show if applied inappropriately. this is heartbreaking. we depend on supertards to build modern conveniences for us to enjoy but this is headed in the wrong direction

  21. Robert Inget on Thu, 21st Feb 2019 11:38 am 

    What Rockman isn’t drawing you a diagram over.
    Most NG is flared, not delivered to consumers.

    http://large.stanford.edu/courses/2016/ph240/miller1/docs/emam.pdf

    Gas flaring, the process of burning-off associated gas from wells, hydrocarbon processing
    plants or refineries, either as a means of disposal or as a safety measure to relieve pressure [1]
    .
    It is now recognized as a major environmental problem, contributing an amount of about
    150 billion m3
    of natural gas is flared around the world, contaminating the environment with
    about 400 Mt CO2 per year [2-3]. Losses from flares are the single largest loss in many industrial
    operations, such as oil-gas production, refinery, chemical plant, coal industry and landfills.
    Wastes or losses to the flare include process gases, fuel gas, steam, nitrogen and natural
    gas. Flaring systems can be installed on many places such as onshore and offshore platforms
    production fields, on transport ships and in port facilities, at storage tank farms and along
    distribution pipelines.
    Gas flaring is one of the most challenging energy and environmental problems facing the
    world today. Nowadays world is facing global warming as one of its main issues. This problem
    can be caused by a rise in CO2, CH4 and other greenhouse gases (GHG) emissions in the atmosphere. On the other hand, the flared gas is very similar in composition to natural gas and is
    a cleaner source of energy than other commercial fossil fuels [2]
    . Because of the increasing
    gas prices since 2005 and growing concerns about the scarcity of oil and gas resources the
    interest in flare gas has increased.

    IOW’s Like Rockman says Big Oil is indeed the world’s biggest NG producer and flare villan.
    Over at ‘Big OIl’ NG, the so called ‘Bridge Fuel’,
    is simply far too cheap to bother extending pipelines to gather and distribute. NG is known as
    ‘associated gas’. IOW’s comes with the prime product like some kind of dangerous contaminant.

    As ‘clickbait’ would say, “What Big Oil won’t tell you”. Light shale ‘oil’ is a mixture of immature
    crude containing natural gas in various proportions. (good to make gasoline, not diesel)

    Let EIA explain;
    https://www.eia.gov/energyexplained/index.php?page=natural_gas_where

  22. Robert Inget on Thu, 21st Feb 2019 12:13 pm 

    If your interested, #2 NG producer in US,
    a person can buy a share today for the low low price of $2.63 per share.

    Chesapeake Energy Corp NYSE: CHK

    Energy : Oil, Gas & Consumable Fuels | Small Cap ValueCompany profile

    Chesapeake Energy Corporation produces natural gas, oil and natural gas liquids (NGL) in the United States. It operates in two segments: Exploration and Production, and Marketing, Gathering and Compression. Exploration and production is engaged in finding and producing oil, natural gas and NGL. Marketing, gathering and compression is engaged in marketing, gathering and compression of oil, natural gas and NGL. As of December 31, 2016, it owned interests in approximately 22,700 oil and natural gas wells. It has a diverse resource base of onshore the United States unconventional natural gas and liquids assets. It has positions in resource plays of the Eagle Ford Shale in South Texas, the Utica Shale in Ohio, the Anadarko Basin in northwestern Oklahoma and the stacked pay in the Powder River Basin in Wyoming. Its natural gas resource plays are the Haynesville/Bossier Shales in northwestern Louisiana and East Texas and the Marcellus Shale in the northern Appalachian Basin in Pennsylvania.

    IMO: NG and NGL’s are Not the Money Pits SHALE
    ‘so called crude oil’ has become.

    Oversupply of NG will go away as shale oil
    investors tire of losing money. Events like winter solar vortex and summers like the one experienced in 2019 Australia will prove me correct.

    Like I said earlier, its heavy oil that’s required to make diesel.

  23. Art Dunham on Thu, 21st Feb 2019 2:56 pm 

    Doesn’t Questor Incinerators solve the methane problem?

  24. DMyers on Thu, 21st Feb 2019 7:30 pm 

    I’d have to go with Rockman on this.

    Take the following from the article. “Meanwhile, higher U.S. oil production has global effects, lowering prices and boosting demand. The effects are more difficult to tease out, but by 2030, the world could consume 1.6 mb/d more than it otherwise would under the high U.S. production scenario. U.S. oil is exported abroad, lowering prices and boosting demand.”

    That fully explains the positive correlation of US production increases with GHG levels. Increasing US production leads to increasing world wide consumption. The fault lies with numerous consumers rather than a few producers.

    Antius has an awesome wind power idea. I got so excited reading it, I dug an old “Mechanics Illustrated” magazine out of the closet and masturbated. Nice work. Could go viral.

  25. Robert Inget on Fri, 22nd Feb 2019 1:21 pm 

    US Exports; That’s right, EXPORTS

    Twelve Empty Supertankers Reveal Truths About Today’s Oil Market

    Firat Kayakiran
    BloombergFebruary 21, 2019
    (Bloomberg) — They are slowly plowing their way across thousands of miles of ocean toward America’s Gulf of Mexico coastline. As they do, twelve empty supertankers are also revealing a few truths about today’s global oil market.

    In normal times, the vessels would be filled with heavy, high sulfur Middle East oil for delivery to refineries in places like Houston or New Orleans. Not now though. They are sailing cargo-less, a practice that vessel owners normally try to avoid because ships earn money by making deliveries.

    The 12 vessels are making voyages of as much as 21,000 miles direct from Asia, all the way around South Africa, holding nothing but seawater for stability because Middle East producers are restricting supplies. Still, America’s booming volumes of light crude must still be exported, and there aren’t enough supertankers in the Atlantic Ocean for the job. So they’re coming empty.

    “What’s driving this is a U.S. oil market that’s looking relatively bearish with domestic production estimates trending higher, and persistent crude oil builds we have seen for the last few weeks,” said Warren Patterson, head of commodities strategy at ING Bank NV in Amsterdam. “At the same time, OPEC cuts are supporting international grades like Brent, creating an export incentive.”

    The U.S. both exports and imports large amounts of crude because the variety it pumps — especially newer supplies from shale formations — is very different from the type that’s found in the Middle East. OPEC members are likely cutting heavier grades while American exports are predominantly lighter, Patterson said.

    Gasoline Glut

    By industry standards, American oil is considered light and low in sulfur, making it great for churning out gasoline, with the result that a glut of the automotive fuel is starting to build up. By contrast, Middle East crude often needs more processing — not a problem for Gulf of Mexico plants that were designed specifically for that task — but it can have a smaller gasoline yield.

    “There is still going to be a lot of growth from U.S. tight oil this year,” said James Davis, director of short-term global oil service at Facts Global Energy. “This will continue to push U.S. exports up.”

    Shippers are counting on the U.S. exports to help the tanker market withstand supply restrictions by the Organization of Petroleum Exporting Countries and allies including Russia. Industry analysts, who actually raised their estimates for what they think the ships will earn this year after the OPEC+ pact was announced in December, are citing rising American shipments as a contributing factor.

    There are usually three or four empty supertankers — very large crude carriers in industry jargon — that would sail empty to the U.S. at any one time, according to shipbrokers.

    The shift has produced knock-on effects around the shipping market. Daily earnings for the VLCCs, which can haul two million barrels of oil, on the benchmark Middle East-to-China route doubled since last week to $29,494, according to Baltic Exchange data.

    “Following a fixing frenzy from the U.S. Gulf Coast late last week, most available tonnage in the Atlantic basin has been soaked up,” said Espen Fjermestad, an analyst at Fearnley Securities AS in Oslo. “With ships ballasting West, rates have shifted up also in the East.”

    https://finance.yahoo.com/news/twelve-empty-supertankers-reveal-truths-125018041.html
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