[John_A]

$this->bbcode_second_pass_quote('Loki', ' ')EROEI isn't a metric the oil industry uses, obviously, nor does anyone else. But as you say, the costs of energy inputs are part of the overall ROI. A 10 year old could immediately grasp this concept. John_A on the other hand....

[Strummer]

$this->bbcode_second_pass_quote('John_A', '')$this->bbcode_second_pass_quote('Loki', 'n')o one gives a rat's behind if I use a million BTUs or a Quadrillion BTUs to get the work done, but they do care if I use the more expensive ($$) of the two.

[John_A]

$this->bbcode_second_pass_quote('ROCKMAN', '&')quot;...no one uses ENERGY metrics to make decisions in the oil field." True...I never have and never will. But I use the cost of energy as one factor along with the cost of every component.

[ROCKMAN]

DC - So true. But given direct energy input accounts for at most 10% of well cost an insufficient rate of return will kill a project long before EROEI gets even close to 1. My guess is somewhere around 5 or 6. But that's on a well by well basis. Industry-wide we need to take into account dry holes and other energy expenditures that don’t come into the accounting on successful production. For us that’s a “sunk cost” and doesn’t have a bearing on the next well evaluation. A company drills 10 dry holes and burns X Btu in the process has a very negative EROEI to say the least. But if one calculates the EROEI of even marginally successful wells they’ll have a positive EROEI.

This is the biggest problem the general public has appreciating that the oil patch isn’t nearly as profitable as they think. They’ll hear that ExxonMobil had a yearly revenue of $XX billion and think that’s all profit. But they have no idea how much XOM spent, including dry hole and dead end projects, to generate that cash flow. Selling oil for $100/bbl doesn’t create an obscene profit if you spent $90/bbl to develop that production. Likewise the energy spent to drill just the successful wells doesn’t tell the full cycle EROEI story either.

[John_A]

$this->bbcode_second_pass_quote('Strummer', '')$this->bbcode_second_pass_quote('John_A', '')$this->bbcode_second_pass_quote('Loki', 'n')o one gives a rat's behind if I use a million BTUs or a Quadrillion BTUs to get the work done, but they do care if I use the more expensive ($$) of the two.

[Strummer]

$this->bbcode_second_pass_quote('John_A', 'R')eally? So all those free solar BTUs the Coalinga oil field project collects to help make steam, those wild amounts of BTUs stolen from the sun will bother the economy somehow? We'll get a recession maybe? A depression? We're using up solar resources faster than the sun can make them?

[dorlomin]

$this->bbcode_second_pass_quote('John_A', 'w')hat Loki, Dorlomin and myself have all just agreed to. It is nice to see that we are all on the right track, and that the amount of energy used to do any given amount of work is irrelevant

[dorlomin]

$this->bbcode_second_pass_quote('John_A', '
')$this->bbcode_second_pass_quote('Loki', '
')I'm pathologically honest, I can squeeze out a fib if my back is against the wall, but it goes against every grain of my being. One reason I keep my mouth shut most of the time.

[John_A]

$this->bbcode_second_pass_quote('Strummer', '')$this->bbcode_second_pass_quote('John_A', 'R')eally? So all those free solar BTUs the Coalinga oil field project collects to help make steam, those wild amounts of BTUs stolen from the sun will bother the economy somehow? We'll get a recession maybe? A depression? We're using up solar resources faster than the sun can make them?

[John_A]

$this->bbcode_second_pass_quote('dorlomin', '[')color=#FF0000]the amount of energy used to do any given amount of work is irrelevant[/color]

[John_A]

$this->bbcode_second_pass_quote('dorlomin', '')$this->bbcode_second_pass_quote('John_A', '
')$this->bbcode_second_pass_quote('Loki', '
')I'm pathologically honest, I can squeeze out a fib if my back is against the wall, but it goes against every grain of my being. One reason I keep my mouth shut most of the time.

[Strummer]

$this->bbcode_second_pass_quote('John_A', 'S')o the Chinese using solar BTUs will crash the economy? Really?

[John_A]

$this->bbcode_second_pass_quote('Strummer', '')$this->bbcode_second_pass_quote('John_A', 'S')o the Chinese using solar BTUs will crash the economy? Really?