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Page added on October 22, 2018
U.S. Shale Has A Glaring Problem
Oil prices are down a bit, but are still close to multi-year highs. That should leave the shale industry flush with cash. However, a long list of U.S. shale companies are still struggling to turn a profit.
A new report from the Institute for Energy Economics and Financial Analysis (IEEFA) and the Sightline Institute detail the “alarming volumes of red ink” within the shale industry.
“Even after two and a half years of rising oil prices and growing expectations for improved financial results, a review of 33 publicly traded oil and gas fracking companies shows the companies posting negative free cash flows through June,” the report’s authors write. The 33 small and medium-sized drillers posted a combined $3.9 billion in negative cash flow in the first half of 2018.
The glaring problem with the poor financial results is that 2018 was supposed to be the year that the shale industry finally turned a corner. Earlier this year, the International Energy Agency painted a rosy portrait of U.S. shale, arguing in a report that “higher prices and operational improvements are putting the US shale sector on track to achieve positive free cash flow in 2018 for the first time ever.”
The improved outlook came after years of mounting debt and negative cash flow. The IEA estimates that the U.S. shale industry generated cumulative negative free cash flow of over $200 billion between 2010 and 2014. The oil market downturn that began in 2014 was supposed to have changed profligate spending, pushing out inefficient companies and leaving the sector as a whole much leaner and healthier.
“Current trends suggest that the shale industry as a whole may finally turn a profit in 2018, although downside risks remain,” the IEA wrote in July.
“Several companies expect positive free cash flow based on an assumed oil price well below the levels seen so far in 2018 and there are clear indications that bond markets and banks are taking a more positive attitude to the sector, following encouraging financial results for the first quarter.”
But the warning signs have been clear for some time. The Wall Street Journal reported in August that the second quarter was a disappointment. The WSJ analyzed 50 companies, finding that they spent a combined $2 billion more than they generated in the second quarter.
The new report from IEEFA and the Sightline Institute add more detail the industry’s recent performance. Only seven out of the 33 companies analyzed in the report had positive cash flow in the first half of the year, and the whole group burned through a combined $5 billion in cash reserves over that time period.
Even more remarkable is the fact that the negative financials come amidst a production boom. The U.S. continues to break production records week after week, and at over 11 million barrels per day, the U.S. could soon become the world’s largest oil producer. Analysts differ over the trajectory of shale, but they only argue over how fast output will grow.
Yet, even as drillers extract ever greater volumes of oil from the ground, they still are not turning a profit.
“To outward appearances, the U.S. oil and gas industry is in the midst of a decade-long boom,” IEEFA and the Sightline Institute write in their report.
However, “America’s fracking boom has been a world-class bust.”
The ongoing struggles raises questions about the long-term. If the industry is still not profitable – after a decade of drilling, after major efficiency improvements since 2014, and after a sharp rebound in oil prices – when will it ever be profitable? Is there something fundamentally problematic about the nature of shale drilling, which suffers from steep decline rates over relatively short periods of time and requires constant spending and drilling to maintain?
Third quarter results will start trickling in over the next few days and weeks, which should provide more clues into the shale industry’s health. There is even more pressure on drillers to post profits because the third quarter saw much higher oil prices.
“Until the industry as a whole improves, producing both sustained profits and consistently positive cash flows, careful investors would be wise to view fracking companies as speculative investments,” the authors of the report concluded.
40 Comments on "U.S. Shale Has A Glaring Problem"
TIKIMAN on Mon, 22nd Oct 2018 8:10 pm
Shale oil is a complete joke. It will not make the US the biggest oil producer as it costs to much and uses too much energy to get.
USA is a shit hole country on Mon, 22nd Oct 2018 10:01 pm
America ain’t gonna make itself great all by itself tikiman, you got a better idea? Given the current sorry ass state of America and its retard in chief I’d say shale oil scams is all USA has left.
Sissyfuss on Mon, 22nd Oct 2018 10:36 pm
” Is there something fundamentally problematic about the nature of shale drilling, which suffers from steep decline rates over relatively short periods of time and requires constant spending and drilling to maintain?”
This is the essence of a rhetorical question.
Outcast_Searcher on Tue, 23rd Oct 2018 1:35 am
And yet, in the real world, the oil majors are generally making huge profits, as they’ve become much more efficient and oil prices have risen.
The Cassandras have been claiming economic doom from Shale oil for many years now, even as such profits have magnified. The Cassandras that can’t read a balance sheet, or understand accounting.
But let’s all pretend that all these businesses are out there deliberately losing tons of money on every oil fracking project, just so the Cassandras can preach their tale of woe. Always wrong — same as it ever was.
Big hint: if it wasn’t financial doom at the low oil prices and the costs of recent years, then it surely isn’t doom at the much higher oil prices and lower net costs (re efficiency gains for the industry) now. Or in the likely higher prices to come, as global supply has trouble keeping up with projected demand, at least in the near term.
Cloggie on Tue, 23rd Oct 2018 3:15 am
Dutch industry consortium puts its weight behind 100MW hydrogen plant feasability study:
https://www.deingenieur.nl/artikel/dutch-industry-explores-possibilities-of-major-hydrogen-factory
Swedish research. Car body as the battery (coal fiber):
https://www.deingenieur.nl/artikel/koolstofvezel-kan-energie-opslaan
(Dutch language only)
print baby print on Tue, 23rd Oct 2018 3:43 am
outcast printing presses are magic thing
Davy on Tue, 23rd Oct 2018 4:41 am
“One Size Fits Germany”-Math Impossibility: Mish Warns “Get Your Money Out Of Italy Now!”
https://tinyurl.com/yaow7kyt
“Try Fixing This The Euro is 11% undervalued in Germany, the largest Eurozone economy. The Euro is 9% overvalued in Italy, the third largest Eurozone economy. The normal way central banks make adjustments to fix over-valued or undervalued situation is through interest rate policy or direct currency intervention. No matter which the ECB does, it will impact Italy and Germany in opposite directions. Meanwhile, interest rates are on the verge of spiraling out of control in Italy.”
“Theory vs Practice In theory, German, Italian, and Greek 10-year bonds should all have the same yield. In practice, they clearly don’t. The spread between German 10-year and Italian 10-year bonds is 330 basis points (3.3 percentage points). The difference is perceived default risk. The odds of Italy leaving the Eurozone are rising.”
“Fatally Flawed Setup The ECB’s interest rate policy, was fatally flawed from inception. Target2 is a failed construct German productivity vs peripheral Eurozone productivity is yet another issue. EU policies take all 27 nations to agree, or nothing gets done. So the broader EU is fatally flawed as well. These flaws were generally recognized actually. So were problems with Greece. Yet, they welcomed Greece with open arms. The global economy is slowing, Trump’s trade polices are wreaking havoc and Brexit is going to damage trade ralations as well. We have had a 10-year recovery, yet the ECB is still expanding its balance sheet. The ECB is supposedly going to cease those asset purchases in 2019. Good luck with that. Who will buy Italian bonds, and at what price? And what about the Italian bond inevitable downgrade to junk? Good luck with that, too. Word of Advice If you have money in Italian banks, get it out now, while you can. Capital controls are coming and Italy is increasingly likely to leave the Eurozone entirely.”
makati1 on Tue, 23rd Oct 2018 4:49 am
Davy wakes up and spews shit all over the PO site. LMAO
Davy on Tue, 23rd Oct 2018 4:52 am
“By Going Nuclear The EU Has Already Lost Its Battle With Italy”
https://tinyurl.com/y78fnqcx
“Ignore the reality that Italy can’t grow their way out of this without shaving the scalps of bondholders and issuing its own currency. Italy’s calm demeanor is what is important. Dijsselbloem is lying when he says that most of the Italian debt is domestically owned. A large portion of it is. But, tell me again, Jeroen, what is that $1+ trillion TARGET 2 balance on the ECB’s books? A lot of it is Italian debt. Seeing marginal improvement in Italy’s 42% Non-Performing Loan portfolio after seven years of enforced austerity is not an endorsement of the policy but an indictment. It’s a real liability which ECB President Mario Draghi says Italy must re-pay before it can leave the euro. Of course Draghi is acting like a loan shark, continuing to backstop purchases of Italian debt under TARGET 2 and then telling the debtor, Italy, it needs to pay up. The bigger these TARGET 2 imbalances get the more leverage Italy has in these budget negotiations. Because no one is buying that the European banking system is not exposed to horrific losses if Italy defaults. And while Dijsselbloem would have no problem bailing-in Italian depositors and ruining the Italian banking system I don’t think he realizes just what the secondary and tertiary effects of that action would be. Why would anyone ever invest in a European bank that can be seized and sold leaving the investors to suffer 100% losses all because the technocrats in Brussels refuse to give up one iota of power? “
“The latest polls have more than 56% of Italians would leave the EU if an Italeave referendum were held today. Brexit never polled that well.”
“The EU has zero leverage over Italy. The so-called populists in charge in Italy know exactly what they are doing. They are killing the EU with kindness. Five Star Movement leader Luigi Di Maio reiterated over the weekend that there is “no Plan B” for leaving the EU. The goal is to reform it from within. That’s a talking point from the campaign they needed to cultivate a “Good Cop” to Matteo Salvini’s “Bad Cop” that talks openly about the euro being a monstrosity and “a crime against humanity.” Italian polls have Salvini’s League more popular now than Di Maio’s Five Star. They are becoming more radicalized. The more Salvini lobs rhetorical grenades at Brussels, the more popular he becomes. Together they command more than 60% of Italians.”
“Dijesselbloem just told Salvini and Di Maio the EU has no truly has no Plan B. You can bet that the Italians actually do.”
Davy on Tue, 23rd Oct 2018 4:54 am
“Davy wakes up and spews shit all over the PO site. LMAO”
And
billy is incapable of debate. Go to bed old man if you hang around here I will neuter your noise.
Anonymous on Tue, 23rd Oct 2018 6:21 am
Both of the organizations putting out this report are ones that I have never heard of before. A glance at their webpages shows them to be greenie front groups, not serious energy analysts “Accelerating the transition to a diverse, sustainable and profitable energy economy”. Both the sites and the report look like they were put together by amateurs. Just strange looking typography and the like.
Dawn on Tue, 23rd Oct 2018 6:32 am
Cloggie
We have found a job for you, you have lots of experiance
https://www.jobmonkey.com/uniquejobs2/circus-job/
Cloggie on Tue, 23rd Oct 2018 6:49 am
“By Going Nuclear The EU Has Already Lost Its Battle With Italy””
Not again this Italian-American trying to write the EU into the ground. As he admits himself Dijsselbloem is a FORMER EU official, so he is deceptive if he claims that the ‘EU is going nuclear’. Italy has only one real problem and that is massive public tax dodging, causing public deficits. The Italians are very rich because of it. All the problems are solved if every household is forced to accept a 10k extra mortgage on their mostly paid-off real estate. They deserve it. Of course Italy can go back to their shabby Lira and print themselves into 10% iannual nflation, but they will learn soon enough that they are stuck with the euro because nobody will accept their lira.
Call their bluff.
Europe is not going to fund an Italian basic income.
Antius on Tue, 23rd Oct 2018 7:00 am
I can’t remember if I shared this with you folks before. Daily and seasonal power tracking for the UK. The figures probably look similar for other countries but I cannot find similar gridwatch sites for any others.
http://gridwatch.co.uk/Renewables
The challenge of a renewable energy future is basically all about matching intermittent power production with demand in a way that avoids pushing costs through the roof. As one can see from the following charts, wind and solar power production in the UK is subject to considerable daily and seasonal fluctuation.
Storing energy with the intention of turning it back into electricity is generally expensive and inefficient. It means building a huge power station equipped with some kind of energy store that effectively uses intermittent electricity as fuel and spits out dispatchable power on demand.
In the UK however, large amounts of energy are used for heating. The UK burns through something like 500TWh of fossil fuel (mostly natural gas) each year for space and water heating. That compares to about 350TWh of energy consumed as electricity and about 500TWh consumed by transport in various ways.
The good thing about heat is that it is very cheaply storable. Large amounts of thermal energy can be stored very cheaply at high energy density in bulk solid materials and water. The article below indicates that storage heaters are on the market that retain some 45% of the original heat some 24 hours after charging.
https://en.wikipedia.org/wiki/Storage_heater
In theory, storage heaters can be developed that will be controllable via an internet or radio connection by grid operators. If these were installed in homes and other buildings, they would provide a huge slew load that can be switched on and off on demand. Looking at the Gridwatch figures, if we assume that during autumn, winter and spring months, some 50% of all power is consumed in heating, we can effectively draw a line through the annual power production curve some 30% above the bottom. Suddenly, the remaining power output from wind and solar power is a lot less variable. The amount of storage capacity that would be needed to perfectly match supply with demand is dramatically reduced. If customers were prepared to tolerate a few hours of power cuts per day for perhaps a dozen days out of each year, it is conceivable that we could build a renewable energy base without any electricity storage at all. If other slew loads can be introduced, i.e. certain industrial users are prepared to tolerate disruption to some processes then domestic brownouts might be avoided on all but the rarest of occasions.
Davy on Tue, 23rd Oct 2018 7:32 am
Thanks Antius for getting the board back on topic.
Dooma on Tue, 23rd Oct 2018 7:39 am
Cloggie, you might find this interesting. Along with fellow solar fans.
Our state government has just announced that it will pay half (up to $4500) of an installed rooftop solar system, allowing you to pay the rest off interest-free through the electricity going back to feed the grid.
There were already quite a few houses with solar, but the transformation since the announcement has been nothing short of amazing. Including our roof.
There is also talk of towns pooling their excess electricity into one large storage battery instead of every system having its own.
We get plenty of sunshine down here, so it makes sense to capitalise on it. Plus, neither the commercial sector or the government are interested in building another coal-fired generator.
Davy on Tue, 23rd Oct 2018 7:43 am
Good boy Dooma. Get on topic and with a good
Disposition. Keep it up.
twocats on Tue, 23rd Oct 2018 8:57 am
fortunately, sometimes facts are still facts.
Nick Cunningham links to the Executive Summary – and there they list their data and methods as well as the companies. they are obviously focusing on companies that are weighted towards fracking (upstream, US).
if majors can paper over their losses with other revenue streams – then they are irrelevant to the discussion. if you are a fracking company then there’s a 79% chance you are losing money – even in the best of times.
Antius on Tue, 23rd Oct 2018 9:11 am
“Thanks Antius for getting the board back on topic.”
You’re welcome. I don’t like telling other folk what to do, given that this board is a rare example of an unmoderated forum and that is valuable in itself. But at least some of the content should be related to the topic of the site.
My researches have brought me back once more to the idea of thermal energy storage, which appears to be the most practical way of storing excess electricity from renewable (and other) energy sources. This conclusion is not self-evident, as storing energy as heat with the idea of turning it back into electric power is less efficient in pure electricity terms than pumped storage, CAES, Li-ion battery and kinetic methods like flywheels. But it has a number of significant advantages over these other options.
1. We need large amounts of heat anyway. In northern climates, we need heat for space heating and in all climates heat is needed for hot water, cooking and high energy industrial processes. All of these functions offer opportunities for energy storage from an intermittent supply, because hot objects can be insulated;
2. Heat can be stored very cheaply, simply by absorbing it in a bulk material. Also thermal storage is quite energy dense – a single cubic metre of rock heated from 300 to 1000K will store about 500kWh of heat. Molten silicon or sand will store over 1MWh per cubic metre due to heat capacity and phase change. Simple heating elements can be used to transfer the energy, which is nothing more complex than a coil of wire. The high energy density, low embodied energy and simplicity of the system make thermal energy storage one of the cheapest ways of storing bulk energy.
3. In many cases, we do not need to convert heat back into electricity, because it is a valuable energy product in itself. In a low-carbon economy, we would probably attempt to use renewable electricity for as many functions as possible to avoid the use of fuels.
a. Steel would be produced in an electric furnace containing a mixture of recycled steel and iron ore. We would use rotating magnetic fields to heat the mixture and carbon monoxide gas from biomass as a reducing agent. The CO and feedstocks will be preheated before entering the furnace by passing them through preheated masonry chutes. Intermittent energy will be stored here as it would take many hours for the masonry to cool significantly after power is reduced. Hence, power supply might be reduced by something like one third for many hours, before production rates are affected.
b. Cement kilns can be similarly bulked out with inert masonry, with magnetic fields used to transfer heat to embedded metal components. Hence, power supply can be reduced on low energy days and increased when power is more abundant. If cement is made in batch processes, the production could simply be switched off.
c. Cooking can absorb intermittent energy. Losses can be minimised through insulation and any losses reduce the space heating load for the building.
d. Hot water applications can be converted to grid control simply by increasing the size of the tank and incorporating phase change materials.
4. Thermal energy storage for electricity production is surprisingly workable, even though relatively inefficient, because the waste heat is a valuable byproduct in a combined heat and power situation. A large electricity consumer, like a shopping centre or office block, could store enough grid electricity at times of peak production to meet its thermal needs. Since the thermal needs are constant from day to day, the thermal store could be coupled to a small steam or other closed cycle thermodynamic machine. This would convert 20-30% of the intermittent power back into baseload electricity, with the waste heat serving the needs of the building. Efficiency isn’t terribly important, because nothing is wasted.
5. A large thermodynamic power plant, burning biomass or coal, could use stored thermal energy to heat steam between the low and high temperature (economiser and superheater) parts of the boiler. Realistically, this might reduce the fuel needed by up to half and an ultra-critical steam plant will recover 50% of the stored heat energy as useful baseload electricity. Integrating thermal stores into thermodynamic plants is a cheap way means of energy storage.
6. Stored thermal energy could be used to power large ships, which need a certain amount of ballast mass. Electricity would be used to heat an insulated rock mass within the ship to temperatures up to 1000C. Steam pipes running through the store would extract heat and convert it to mechanical power using a steam turbine. Realistic efficiency is 40-50%. Most likely, the thermal store would be coupled with a more conventional boiler burning biomass.
Collectively, I believe that these solutions would go a very long way towards allowing intermittent renewable energy systems to meet the energy needs of future society. They do not necessarily require huge scale reengineering, as would be the case for district heating systems. It is conceivable that they could be developed relatively rapidly and affordably.
shortonoil on Tue, 23rd Oct 2018 9:34 am
In the energy industry a company that can’t produce energy is going to lose money? Shale is net energy negative, and always has been. It sources are too deep, its permeability too low, its products too light, and its market is limited to diluent, and petrochemical feedstock. Its production is needed to process heavier crude, but it comes at a price that the economy can not afford. When it true cost becomes evident, 1.5 million new wells every 5 years, it will be abandoned!
BW
Mark Ziegler on Tue, 23rd Oct 2018 10:56 am
The answer to the worlds energy problem is simple and staring us all in the face. The technology is already there.
A comprehensive rail road system to take over all fossil fuel burning vehicles.
https://www.youtube.com/watch?v=sE4A0nPjyqQ
I AM THE MOB on Tue, 23rd Oct 2018 10:57 am
Alex Jones ex-wife
https://i.redd.it/wmj0hzn7sxt11.png
I AM THE MOB on Tue, 23rd Oct 2018 11:22 am
Younger Americans are better than older Americans at telling factual news statements from opinions
http://www.pewresearch.org/fact-tank/2018/10/23/younger-americans-are-better-than-older-americans-at-telling-factual-news-statements-from-opinions/
No shit..Just look how braindead the boomers are on this blog..Clogg with his info wars and Davy with Zerohedge..and Mak with his organicprepper and burning platform..
Nuff said..
Davy on Tue, 23rd Oct 2018 11:59 am
Slob, there is no content in your above comment which is par for your dumbass. When I make a comment with an article as the reference then debate it with a comment with content. If your comment is good then it will put to rest my point if it is not accurate of lacking. We know you think you are hot shit but you are not. Generally you just throw out stupid comments with title and link and say “see”. You are incapable of digesting said article with usable information. You are a fraud and a fake. Nothing is lamer than when you talk about breeding rich people’s daughters then a comment later trying to present a serious intellectual point. Get a grip dumbass you are an uneducated kid pretending you are something special.
Davy on Tue, 23rd Oct 2018 1:11 pm
Sorry for losing my shit today everyone.
I’t’s that time of the month again and I ran out of Midol.
Davy on Tue, 23rd Oct 2018 1:20 pm
above is not supertard obviously
I AM THE MOB on Tue, 23rd Oct 2018 1:23 pm
Toward a General Theory of Societal Collapse. A Biophysical Examination of Tainter’s Model of the Diminishing Returns of Complexity (Bardi 2018)
https://www.scribd.com/document/391436603/Toward-a-General-Theory-of-Societal-Collapse-A-Biophysical-Examination-of-Tainter-s-Model-of-the-Diminishing-Returns-of-Complexity-Bardi-2018
I AM THE MOB on Tue, 23rd Oct 2018 1:59 pm
The World Would Be a Better Place Without the Rich
https://jacobinmag.com/2018/10/rich-people-philanthropy-inequality-wealth?fbclid=IwAR3k_O_pzgL6J8Yq7zz-G6J16Y9O7b3iYAFoTX7GJ8vpnQjtgnvNuG_mCDk
Antius on Tue, 23rd Oct 2018 2:22 pm
It would mean fewer of your people in the world Mob. That is a major selling point.
Cloggie on Tue, 23rd Oct 2018 2:34 pm
“Jews Dominate Forbes Rich List”
https://forward.com/schmooze/131574/jews-dominate-forbes-rich-list/
Expect millimob to begin organizing a pogrom… oh wait…
Wikipedia “List of ethnic groups in the United States by household income”
Indian American (2016) : $122,026 [2]
Jewish American (2016) : $100,059 [3]
Australian American (2016) : $91,452 [3]
Taiwanese American (2016) : $90,221 [3]
Filipino American (2016) : $88,745 [2]
British American (2016) : $79,872[3]
Austrian American (2016) : $78,127[3]
Russian American (2016): $77,841 (2014)[3]
Latvian American (2016): $77,636[3]
Lithuanian American (2016) : $76,694[3]
Indians being on top is probably caused by their households counting 20 people:
http://www.e-farsas.com/wp-content/uploads/trem_india.jpg
Not even a single homosexual Jew can compete with that.
I AM THE MOB on Tue, 23rd Oct 2018 2:52 pm
Clogg
I am not some jew lover like Trump and Republicans are..You dumb fucking moron.
And Jews aren’t an ethnic group they are a religion..
You are so fucking stupid its astonishing..
I dont a give a flying fuck who the rich are..All I know is when the oil starts to run out it will be game fucking on..
You fat sack of shit.
Antius on Tue, 23rd Oct 2018 3:49 pm
Mob, you are a lunatic that prays for collapse so you can unleash rape and murder. Has it occurred to you that people get rich by working hard, saving money and generally doing well? All the wealthy people I know are hard working and shrewd. Most of the poor I know are lazy, didn’t work hard at school and think anyone that did better than them owes them something. Why don’t you stop fantasizing about death and get a job and try working hard? Such is how fortunes are made.
Cloggie on Tue, 23rd Oct 2018 4:31 pm
“You fat sack of shit.”
https://youtu.be/G87UXIH8Lzo
https://youtu.be/f9xHhbG3wvk
Dooma on Tue, 23rd Oct 2018 7:54 pm
More on the effect that rooftop PV solar is having on coal-fired generators. The result-sending the daytime trading price of electricity into negative.
https://reneweconomy.com.au/solar-sends-day-time-prices-negative-in-coal-dominated-queensland-13891/
Cloggie on Tue, 23rd Oct 2018 10:56 pm
Yep, “please burn our electricity”.
Translation: desperate need for storage, the last missing link.
Dooma on Tue, 23rd Oct 2018 11:09 pm
Burning coal and polluting the atmosphere just for the sake of keeping their turbines spinning. This because a cold re-start of a large coal-fired unit is a lengthy process. Not to mention costly.
So we are pumping out needless CO2, NOX and SOX into the planet for money, destroying the earth for a buck. Nothing new there.
boney joe on Wed, 24th Oct 2018 12:10 am
“Thanks Antius for getting the board back on topic.”
“You’re welcome. I don’t like telling other folk what to do.”
“Good boy Dooma. Get on topic and with a good
Disposition. Keep it up.”
Just a sampling of the fawning, obsequious nonsense brought to you by Anti-AnusGloryHole and DonaldDavyTurd (DDT). It’s enough to make one vomit .
Cloggie on Wed, 24th Oct 2018 12:20 am
It’s enough to make one vomit.
There are documented cases of people who suffocated at that occasion.
https://www.youtube.com/watch?v=fjwWjx7Cw8I
Not that I want to compare you with this great musician, boney joel, the board’s lesbian.
boney joe on Wed, 24th Oct 2018 1:11 am
Clogged:
Your attempted sardonic humor is instead just stupid.
Chrome Mags on Wed, 24th Oct 2018 1:46 am
Let’s see, what was that again? Oh yeah, EROEI. If the energy returned on energy invested was high enough, all these companies would be turning a profit.
Peak oil blogs kept referring to the Red Queen, and here it is, shale oil. Next!