[dissident]

Why is anyone placing any faith in tight oil to resurrect US oil production? The Bakken and some other locations are small reservoirs. It's the nonsensical convolution of "shale oil" with an essentially conventional reservoir like the Bakken (the oil is in a dolomite layer and not in the shale) that produces the trillions of barrels of untapped oil hype. Nobody, anywhere, is extracting kerogens from shale deposits and making oil out of them. The Enron style antics by Chesapeake are not an indicator of the true reserves in the Bakken. The drilling permits and production are the only objective indicators of the performance of the Bakken.

[SeaGypsy]

Why? Because they want to believe. The same Americans who 5 years ago were telling me about the evil oil company conspiracy to lock up oil are the last year or so spouting this garbage "Saudi America". They were so keen to believe there is plenty, it took very little to convince them.

[dissident]

$this->bbcode_second_pass_quote('SeaGypsy', 'W')hy? Because they want to believe. The same Americans who 5 years ago were telling me about the evil oil company conspiracy to lock up oil are the last year or so spouting this garbage "Saudi America". They were so keen to believe there is plenty, it took very little to convince them.

[John_A]

$this->bbcode_second_pass_quote('Ron Patterson', '')$this->bbcode_second_pass_quote('', 'J')ohn A wrote:
When crap rock with nothing but a little help from a frack job can cough up oil production larger than Prudhoe Bay and Cantarell COMBINED (largest conventional oil fields in the Western hemisphere for those unfamiliar with them) it just doesn't seem fair to think of what is going on as flash in the pan.

[John_A]

$this->bbcode_second_pass_quote('dissident', 'W')hy is anyone placing any faith in tight oil to resurrect US oil production?

[ROCKMAN]

John - Good to get folks back on the rate dynamics and away from counting bbls in the ground. And there's one big difference between a shale reservoir with 10 billion bbl of oil in it and a conventional field that had 10 billion bbls of oil in it originally: to bring those 10 billion bbls of shale oil to market requires the continuous drilling of expensive wells. The old conventional fields, once developed, required only rather low production costs to keep that oil coming to the market. Even when the KSA was selling Ghawar oil for $10/bbl in 1986 they were making a profit. I don’t think many shale wells will be drilled at such low prices and thus much of those 10 billion bbls will never be produced. And if they are developed it won’t be done at such low prices.

[John_A]

$this->bbcode_second_pass_quote('ROCKMAN', 'J')ohn - Good to get folks back on the rate dynamics and away from counting bbls in the ground. And there's one big difference between a shale reservoir with 10 billion bbl of oil in it and a conventional field that had 10 billion bbls of oil in it originally: to bring those 10 billion bbls of shale oil to market requires the continuous drilling of expensive wells.

[agramante]

John_A-

And Hubbert's supposition of a nuclear future hasn't come to pass, for a variety of reasons. Now the future belongs to renewables, according to some anyway.

Were I in the business of predicting energy markets, I could probably find a better way than taking a ruler, selecting a portion of the historical trend, and drawing a straight line out from that. The IEA's "unconventional undiscovered" is basically that: drawing a flat line out from the present day, neatly making up for all decline in conventional oil fields. That approach strikes me more as wishful thinking than any realistic estimate. Boosters in any industry, be it real estate, finance, energy, or anything else, like to predict future success.

[Ron Patterson]

$this->bbcode_second_pass_quote('', 'J')ohn A wrote: The Bakken formation has been producing since the 1950's, are you implying that it will be gone by 2060 or so?

[SeaGypsy]

Obama will be praying these hard plays can keep up for the duration of his term. Whoever is in government when the reality bites is going to be in a world of trouble.

[ROCKMAN]

John – You know that old saying about “Allowing folks to just suspect you’re a fool by saying nothing is better than opening your mouth and proving them correct?”

I’ve got that tattooed on my ass. Thankfully I have a big ass. LOL. I’ll make you a deal though. Provide me with a fairly accurate price forecast for oil, NG and coal for the next 30 years along with a ball park figure for the economic growth of the world’s major economies for the next 30 years and I take a shot as to how much oil, NG and coal we’ll be producing every year for the next 30 years. I’ll have to guess at the geologic component but for just the next 30 years that won’t be too difficult. Probably won’t be too accurate given other potential factors I’m not taking into account but might be as good as anyone else’s dumb guess.

As Ron points out the Bakken development today is not the Bakken of 50 years ago or even 10 years ago. OTOH if 10 years ago you had asked folks who were experts in the Bakken and had a good understanding of horizontal drilling and frac’ng (which had already led to the boom in the Austin Chalk carbonate shale play in the 90’s) what the Bakken would be producing today IF oil were selling for $30/bbl as it was in 2000 I doubt many would predict the current production rate. OTOH if you told them oil would start bouncing around $100 they probably would have been much more optimistic.

I didn’t pick 2000 arbitrarily. I was drilling horizontal wells in a tite conventional field in WY at that time. My directional drillers were hands who had been doing some of the hz work in the Bakken at that time. They had the technique down pretty good by that point. Frac’ng hz wells then wasn’t new either. Obviously what changed the game, and any projection of production rates, was the increase in oil prices. Not predicting it will happen but if one assumes oil drops and holds at $40/bbl in a year what do folks think the rig count will be in the Bakken the following year?

[agramante]

Carter was the only President who was honest about our energy situation. Between that honesty and his zero charisma (and some very ugly shenanigans involving Iranians and Contras), you can see what it got him. Let's hear it for sunny obliviousness!

"The Bakken and Eagleford are making more oil, right now, than both. And what matters to the students of peak? FLOW RATES. Critical information, and as far as flow rates, the Bakken and Eagleford are on the move! And producing more than those two fields COMBINED."

Some real sophistry there. The fields producing about 1.7% of the world total is supposed to alleviate the problem of peak oil, when their ultimately recoverable reserves aren't even close to other faded giants like Prudhoe Bay or Cantarell? (To say nothing of the really big boys in the mideast.) Of course, when the URR is so much less than the conventional fields, then more shale plays just like them must be found and developed, and at ever-increasing rates, to make up for their loss, as well as the ongoing decline elsewhere in the world.

[John_A]

$this->bbcode_second_pass_quote('agramante', 'J')ohn_A-

And Hubbert's supposition of a nuclear future hasn't come to pass, for a variety of reasons. Now the future belongs to renewables, according to some anyway.

[John_A]

$this->bbcode_second_pass_quote('Ron Patterson', '')$this->bbcode_second_pass_quote('', 'J')ohn A wrote: The Bakken formation has been producing since the 1950's, are you implying that it will be gone by 2060 or so?

[John_A]

$this->bbcode_second_pass_quote('ROCKMAN', '
')As Ron points out the Bakken development today is not the Bakken of 50 years ago or even 10 years ago.

[agramante]

$this->bbcode_second_pass_quote('', 'Y')ou've just discounted the entire peak oil method of predicting future oil production, with a single sentence.

[ROCKMAN]

A – “I've noticed production forecasts of this sort tend not to have error bars like…” There’s an even worse flaw IMHO in just about every forecast I’ve seen: No pricing model. I’m sure I’m starting to irritate some folks by repeating but many discussion ignore the obvious: price has greater control over future production rates that any other parameter. There is no technology or clever geologist that could have created production levels we see today in the Bakken or any of the shales if oil prices had not risen to current levels.

Which means no forecast has any supportive validity if it doesn’t include a price platform. Granted predicting prices years down the road is difficult but without making such assumption how can one predict future production from any play 20 to 30 years out without basing it on pricing? Not too difficult to predict Bakken or EFS drilling activity for the next 12 months or so. Just like it wasn’t too difficult to predict east Texas shale drilling activity back in the summer of ’08. That’s why Devon signed long term contracts for 18 rigs. Well, perhaps not that easy given that less than a year later Devon broke the contracts on 14 of those rigs and paid a $40 million penalty. That straight line of NG prices rising from $7 to $12 per mcf and beyond looked too good to be true. And it wasn’t.

All plans work and all straight lines continue indefinitely. Until they don’t. I would begin to guess what oil will be selling for in 5 years. But if my activity forecast assumed $40/bbl it would contain very little activity in the shales. OTOH if I assumed $110/bbl a very different forecast would develop. Which is exactly why many early forecast for the shales proved pessimistic. And for the most part that had little to do with not understanding the geology or technology. They were based upon prices staying about where they were. Just as many of the current optimistic prediction are assuming today.

[SeaGypsy]

Spot on again Rock.

The geopolitical ramifications are just huge. Way beyond the breadth of the silly topic heading. Even those of us with a few over average IQ (or many) get brain hurt when it comes to grokking the complexity of issues around our topic; we tend to specialize and hold onto our basic predilections- looking at peak oil is like looking at the sun- without breaking gaze or filtering (will send you either blind, mad or both).

http://sciencebasedlife.wordpress.com/2 ... n-purpose/

[John_A]

$this->bbcode_second_pass_quote('agramante', ' ')But if you're looking for investors, then draw that line pointing up! Mitigating factors be damned.

[John_A]

$this->bbcode_second_pass_quote('ROCKMAN', 'A') – “I've noticed production forecasts of this sort tend not to have error bars like…” There’s an even worse flaw IMHO in just about every forecast I’ve seen: No pricing model.