[JV153]

$this->bbcode_second_pass_quote('StarvingLion', 'S')tarvingLion's State of the Union Address in 2015.

[rdberg1957]

Given all the converging threats which create dilemmas and constrict choices, I believe humanity has very little time on a geologic scale. I don't believe individual efforts amount to much given our problems with resources (oil depletion, fresh water, soil), ocean degradation, biodiversity and extinction, population, and greenhouse effects. The combination of threats is what is so daunting; the probability that humans can escape what is to come diminishes with each passing year.

[Lore]

$this->bbcode_second_pass_quote('rdberg1957', 'G')iven all the converging threats which create dilemmas and constrict choices, I believe humanity has very little time on a geologic scale. I don't believe individual efforts amount to much given our problems with resources (oil depletion, fresh water, soil), ocean degradation, biodiversity and extinction, population, and greenhouse effects. The combination of threats is what is so daunting; the probability that humans can escape what is to come diminishes with each passing year.

[vox_mundi]

Shell Abandons Disappointing Offshore Alaskan Well

$this->bbcode_second_pass_quote('', 'L')ONDON — Royal Dutch Shell said Monday it would stop exploration off the coast of Alaska “for the foreseeable future.”

The decision came after the Burger J well, which the company drilled this summer, produced disappointing results. The company said the well “found indications of oil and gas but these are not sufficient to warrant further exploration” of the Burger prospect, a geological structure.

Shell said that the decision reflected not only the disappointing results from the well but “the high costs associated with the project and the challenging and unpredictable federal regulatory environment in offshore Alaska.”

The decision also indicates that even though the oil industry believes the Arctic has major resources, the costs, a tricky environment and other risks are so high in the area that the hidden oil and gas will be difficult to develop if oil prices stay low.

Shell’s efforts to drill in Alaska have long seemed quixotic. The company’s decade-long project has been dogged by the opposition of environmental activists, who said oil and gas production posed unacceptable risks in the fragile Arctic. Shell also suffered from mishaps; in 2012 it drilled two shallow wells but a drilling ship, the Kulluk, ran aground.

The environmental protests continued this year when the Obama administration gave the green light for the company to resume its efforts. Investors and industry executives questioned the wisdom of Shell’s spending heavily and putting its reputation at risk — especially with oil prices having fallen over the last two years from $110 per barrel to below $50 per barrel.

Stopping drilling in offshore Alaska is a major disappointment for Shell, whose executives thought they had locked up a potentially huge trove of oil there. In July, Ben van Beurden, Shell’s chief executive, said that the area where the company was drilling in the Chukchi Sea, 150 miles offshore, “has the potential to be multiple times larger than the largest prospects in the U.S. Gulf of Mexico.”

At the time, Mr. van Beurden also said that Shell would not learn enough from one well to figure out how much oil and natural gas was in the area unless the results were very disappointing.

“Shell continues to see important exploration potential” in offshore Alaska, Marvin E. Odum, the company’s head of exploration and production, said in a statement. “However, this is clearly a disappointing outcome.”

The Alaska operations have cost billions of dollars. Shell said the value of Alaska drilling on its balance sheet was $3.1 billion, and that it had a further $1.1 billion in contractual commitments, probably for items like drilling rigs. The company said it would take write-offs as a result of the decision to halt drilling.

[onlooker]

a perfect sign of the times. Oil very low price making exploration more focused in terms of cost/price ratio. Also, this highlights how now oil and gas are becoming more difficult to find and expensive to access and produce. The low hanging fruit has already been plucked.

[Paulo1]

re: The low hanging fruit has already been plucked.

You said it!!! This will really send a message to the Drill Baby Drill Energy Independent folks.

[yellowcanoe]

$this->bbcode_second_pass_quote('Paulo1', '
')
You said it!!! This will really send a message to the Drill Baby Drill Energy Independent folks.

[Hawkcreek]

$this->bbcode_second_pass_quote('yellowcanoe', '')$this->bbcode_second_pass_quote('Paulo1', '
')
You said it!!! This will really send a message to the Drill Baby Drill Energy Independent folks.

[ROCKMAN]

Paulo - There never really has been much "low hanging fruit" when it comes to oil exploration. As I just posted elsewhere there were many dozens of wells drilled in the N Sea before the first major oil field was discovered. It's easy to look at big fields like Ghawar and the N Slope and think they were easy pickings....they weren't. There has never been a significant oil field discovered that wasn't preceded by numerous dry holes. In fact with the technology we have today finding oil/NG has never been easier. The real problem is the lack of viable targets left to find.

[onlooker]

Rockman by viable do you mean much easy flowing oil and easily accessible gas?

[kiwichick]

@ onlooker

not that i'm an expert, but i'd suggest size (of the oil/gas field ) and location/depth are important , as well as ease of extraction

[hvacman]

$this->bbcode_second_pass_quote('', 'I')n fact with the technology we have today finding oil/NG has never been easier. The real problem is the lack of viable targets left to find.

[onlooker]

$this->bbcode_second_pass_quote('kiwichick', '@') onlooker

not that i'm an expert, but i'd suggest size (of the oil/gas field ) and location/depth are important , as well as ease of extraction

[hvacman]

$this->bbcode_second_pass_quote('', 'F')or the oil industry, however, the well results were bad news.

“That was a huge disappointment not only for Shell but also for the industry,” said Fadel Gheit, an oil analyst for Oppenheimer & Co. “This has been a saga. Bad timing, bad planning, bad circumstances. It was not meant to be. Everything that could go wrong went wrong.”

He said that though the company only completed one well, he said that it was the best prospect Shell had. “If you wanted to make a bet on one horse, this was the horse in for the money,” he said. “This was the best candidate.” In the 1990s, five wells were drilled in the area and abandoned after yielding natural gas, but by early 2008 oil prices had soared and Shell had taken another look at the seismic data.

[dolanbaker]

$this->bbcode_second_pass_quote('ROCKMAN', 'P')aulo - There never really has been much "low hanging fruit" when it comes to oil exploration. As I just posted elsewhere there were many dozens of wells drilled in the N Sea before the first major oil field was discovered. It's easy to look at big fields like Ghawar and the N Slope and think they were easy pickings....they weren't. There has never been a significant oil field discovered that wasn't preceded by numerous dry holes. In fact with the technology we have today finding oil/NG has never been easier. The real problem is the lack of viable targets left to find.

[onlooker]

Or maybe the easier to get at oil both economically and energy wise. Also, can mean if we use the metric of viable as per Rockman reference, taking into account the entire process that oil fields and wells gave more bang (oil to extract) for the buck in yonder times then now.

[Pops]

Yep, a big dot, Shell went elephant hunting in the Arctic and got skunked

another,
Brazil / Petrobras (pre-salt, ultradeep Tupi field) bonds cut to junk status

the 3rd is even on weakening demand everyone is pumping flat out and spare capacity is falling - shale LTO is not spare capacity

and as Pete said somewhere, depletion continues apace.

[ennui2]

People shouldn't draw the conclusion that if drilling retreats that they'll never go back again and that there's no oil to recover. The jury is still out on that. All we know is they don't think it's worth their while right now. I have no doubt that if we have sustained >$100 oil prices that someone will try again.

[Pops]

The entire point of peak oil is not that oil production stops overnight.
It is that without continual replacement of depleting capacity, declines overtake additions and production falls.