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There needs to be policy behind US "energy independence". We ended up building an oversupply of gas and oil to export to a world in the midst of a trade war and then Covid. "America First" is pretty ironic and pretty unfocused.
Well, we never really did make it to an Oil Export market. It was only Gas, but was hyped as "Energy Independent."
Meanwhile it is all within US to make the whole Oil mess irrelevant. We are still the big Oil Burners of the Planet.
Rules of Oil are the same as Cocaine for Tony Montana in Scarface. "Don't get high on your own supply."
Folks that make money on Oil, sell it. Folks that lose money on Oil, buy it. First folks to quit are the biggest winners.
But at this point can move beyond Oil for Ground Transportation (that is what we still do with about 70% of it), because Renewable Electricity can now handle most of that, and do it for half the price.
If we were to "quit" Oil, we would come out massively ahead, and Russia and the Middle East would drop into a hole.
What if we just nationalize our domestic oil industry/production like the House of Saud did in that hellhole?
Will that make a difference? I dont get how something in so high demand, cannot not make someone out there a profit.
I explained in the OP why bailouts/ nationalization is not a solution. Plus, governments have a tendency to mismanage things.
There's a concept called EROEI (energy returned on energy invested, ie how many barrels of oil you receive for every barrel of oil you put into production). Shale oil has a very poor EROEI. In the early days of US oil production, the EROEI was very high. An oil rig in 1930s Texas would produce 100 barrels of oil for every 1 barrel of oil invested, and would remain productive for decades. With shale oil, the EROEI is something like 5 to 1. And the wells have a horrific depletion rate. So constant drilling is required. That's why it will never be profitable.
Well, we never really did make it to an Oil Export market. It was only Gas, but was hyped as "Energy Independent."
Meanwhile it is all within US to make the whole Oil mess irrelevant. We are still the big Oil Burners of the Planet.
Rules of Oil are the same as Cocaine for Tony Montana in Scarface. "Don't get high on your own supply."
Folks that make money on Oil, sell it. Folks that lose money on Oil, buy it. First folks to quit are the biggest winners.
But at this point can move beyond Oil for Ground Transportation (that is what we still do with about 70% of it), because Renewable Electricity can now handle most of that, and do it for half the price.
If we were to "quit" Oil, we would come out massively ahead, and Russia and the Middle East would drop into a hole.
Do you understand that there is no substitute for oil?
Hey, remember all that talk about U.S. energy independence and "Saudi America?" What a farce that was. The shale oil industry has never been able to make a profit, and they are drowning in debt. Now they drastically cutting production.
The U.S. shale oil industry that was supposed to be responsible for our energy independence is in the beginning stages of collapse.
According to the Baker Hughes rig count, since last year U.S. rigs have declined from 701 to 253. https://rigcount.bakerhughes.com/
Remember: energy runs the economy. GDP growth is only achieved by energy production/consumption growth, and oil is the chief energy source today. No oil production growth = no GDP growth. No GDP growth means that this global, debt based pyramid scheme comes crashing down.
Without shale oil, US oil production since 2006 would have remained flat. US shale oil has been responsible for 75% of the global increase in oil production since 2008.
Bailing oit the shale oil industry will only add another layer of bankruptcy to the US government. And even if they do get bailed out, their 50% annual decline rate is not a long-term sustainable business model, unless the Federal Reserve can print more oil reserves, that is.
I am a oilman here in the oilfields of West Texas and the business is picking back up.
I explained in the OP why bailouts/ nationalization is not a solution. Plus, governments have a tendency to mismanage things.
There's a concept called EROEI (energy returned on energy invested, ie how many barrels of oil you receive for every barrel of oil you put into production). Shale oil has a very poor EROEI. In the early days of US oil production, the EROEI was very high. An oil rig in 1930s Texas would produce 100 barrels of oil for every 1 barrel of oil invested, and would remain productive for decades. With shale oil, the EROEI is something like 5 to 1. And the wells have a horrific depletion rate. So constant drilling is required. That's why it will never be profitable.
oh geez. Into the EI EI O nonsense, as well?
You must be an Olde Skool Peak Oil Doomer?
Sorry but EROEI was nonsense, too.
It was a misunderstanding of ROI. Return on Investment. A MONEY Term. NOT an Energy Term.
Frack and Tar Sands stood EROEI on its head, spun it around and crapped down its throat.
Turned almost any amount of a CHEAP Energy could be thrown down hole if a VALUED Energy came out.
Had nothing to do with Energy Ratios. Just money. That is why MONEY (the prices) are what shut things down. Not Energy. Not Ever.
Indeed. The prepared remarks of Bill Thomas, CEO of EOG Resources that are to be given to the 19th annual US Shale Summit were leaked yesterday:
"Our industry is collapsing. There will be no more energy soon and that will destroy our economy, government, and way of life. Our people will be fighting in the streets over a can of beans, and I expect cannibalism of dead relatives to become an accepted norm. Everything basically sucks."
Why would he tell you anything positive when he makes out better selling doom and gloom
I am a oilman here in the oilfields of West Texas and the business is picking back up.
Same. We work our own ranch and the family has gathered rights here and there since the 1940s. The rights accumulation side is interesting. I just bought a fair bit of production in Reagan country from a Houston Co. that is circling the drain. There is money to be made.
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