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Economics vs. ETP

Discuss research and forecasts regarding hydrocarbon depletion.
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Re: Economics vs. ETP

Unread postby asg70 » Thu 07 Dec 2017, 11:56:50

$this->bbcode_second_pass_quote('shortonoil', '')$this->bbcode_second_pass_quote('', 'S')o let's hope and pray that the Etp Model is flawed.

We can hope so!


Be genuine. Your ego doesn't want to take the hit of being proven wrong.

BOLD PREDICTIONS
-Billions are on the verge of starvation as the lockdown continues. (yoshua, 5/20/20)

HALL OF SHAME:
-Short welched on a bet and should be shunned.
-Frequent-flyers should not cry crocodile-tears over climate-change.
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Re: Economics vs. ETP

Unread postby Cog » Thu 07 Dec 2017, 13:25:46

After shorty's ETP model blows up, which should be within the next six months, he will move onto some other scam. Its what his type does.
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Re: Economics vs. ETP

Unread postby shortonoil » Thu 07 Dec 2017, 13:56:44

$this->bbcode_second_pass_quote('', 'T')he oil industry will start to cannibalize on its existing reserves until they are exhausted.


The industry is now replacing less than 8% of the reserves that it is extracting. Water breakthrough occurs at an average of 6.9 years for offshore, or the point where the field is 79% depleted. Existing producing fields are at least on average that old. Replacement has been low for more than a decade. Production growth from these fields can be expected to continue for no more than a year or so. The Giants, that still produce 60% of the worlds oil supply, and account for less than 1% of its fields, have apparently reached their maximum production levels, and are likely to soon go into decline; being on average more than 70 years old.

According to the Etp Model the petroleum industry, to continue at its present production rate, must now be receiving 15.7 quad BTU per year from other sources. That number is presently increasing by 2.6 quad BTU per year. The only available source for an energy input of that magnitude is NG, but the growth in NG production appears to have gone stagnant.
$this->bbcode_second_pass_quote('', 'I')n 2016, global natural gas production increased by only 0.3%, or 21 billion cubic metres (bcm) to 3552 bcm , the weakest growth in gas output for [20 years], other than in the immediate aftermath of the financial crisis

https://www.bp.com/en/global/corporate/ ... ction.html

Without increasing production of NG to help power petroleum production Peak Oil is imminent -- or it is already here. The 2014 price crash was the incentive that caused producers to boast production to its maximum. There is no upside remaining to be extracted from existing fields. Once the Peak becomes generally recognized faith will be lost in the Central Banks capability to generate miracles. With a world Debt/ GDP ratio of 320% irrational exuberance will rapidly turn to fear. Market reaction will be violent!
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Re: Economics vs. ETP

Unread postby onlooker » Thu 07 Dec 2017, 14:32:42

$this->bbcode_second_pass_quote('radon1', 'S')o, with the ETP trash duly thrown out to the trash bin given the oil price dynamics, the trickster is now up with a new "report" to show us the "truly real truth"?

From what I have heard, the running average for the WTI price is STILL running below the Etp MAP. So some of you better get your facts straight :razz: :razz:
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Re: Economics vs. ETP

Unread postby ROCKMAN » Thu 07 Dec 2017, 15:14:44

shorty - This is where you lose me. Everything you describe (low reserve replacement, fields already at high water cut and thus already at high lifting cost, depleting NG reserves which were supplementing some oil production ops such as the Canadian oil sands, an industry removing an ever increasing of oil from the market place to fuel its activity, etc.) paints a picture of increasingly less oil for a world fully addicted to it. A world that bought 84 million ICE's last year. That is not a dynamic forecasting lower oil prices but higher prices. Rather simple model: you keep saying the industry is delivery ever decreasing amounts of net oil. From my producer point of view that's great: I would rather sell 60 bbls of oil @ $100/bbl then 100 bbls of oil at $40/bbl. Nothing would please me more then see 70% competitors go out of business. Especially all those f*cking Canadians in Alberta. LOL.

I've always made better ROR's during the busts then during the booms because I know how to make a f*cking profit in this business. LOL.
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Re: Economics vs. ETP

Unread postby shortonoil » Thu 07 Dec 2017, 15:32:45

$this->bbcode_second_pass_quote('', 'W')hen PStarr decides he likes somebody he becomes quite the defensive groupie.


That is an interesting comment coming from someone that no one likes!

Back to the subject at hand:

The world's economy is now running on a combination of extreme complacency, and hubris. That can change to panic in short order. The internet can propagate the message that Peak has arrived at the speed of light. The implication may take a little while to sink in because it is now completely off most people's radar. The majority of people just do not understand that the world runs on oil. But, with $250 trillion in unpayable debt hanging over the world's head, adjustment once it begins, will happen as fast as the message arrives.
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Re: Economics vs. ETP

Unread postby Outcast_Searcher » Thu 07 Dec 2017, 15:40:27

$this->bbcode_second_pass_quote('shortonoil', '')$this->bbcode_second_pass_quote('', 'W')hen PStarr decides he likes somebody he becomes quite the defensive groupie.


That is an interesting comment coming from someone that no one likes!


You mean YOU don't like ASG, because he uses facts and trends which the doomers don't want to admit exist.

Pretending like "no one" likes those you don't like the comments of is like pretending your indefensible data is the only "correct" data out there. Just more nonsense.

I don't agree with every point ASG makes 100% of the time. But since ASG tends to back up his/her points and use credible data/articles to make his points, I like his/her posts just fine.

BTW, I don't like that you apparently lack the ability or willingness to properly use the quote function on this site, and properly give credit to whom you're quoting.
Given the track record of the perma-doomer blogs, I wouldn't bet a fast crash doomer's money on their predictions.
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Re: Economics vs. ETP

Unread postby shortonoil » Thu 07 Dec 2017, 17:46:47

$this->bbcode_second_pass_quote('', 'Y')ou mean YOU don't like ASG, because he uses facts and trends which the doomers don't want to admit exist.


He uses facts? Are you referring to the stuff that he copies out of the Onion, or the stuff he gets out of his old Mad Magazines? Can you be a little more specific?
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Re: Economics vs. ETP

Unread postby Outcast_Searcher » Thu 07 Dec 2017, 19:26:58

$this->bbcode_second_pass_quote('shortonoil', '')$this->bbcode_second_pass_quote('', 'Y')ou mean YOU don't like ASG, because he uses facts and trends which the doomers don't want to admit exist.


He uses facts? Are you referring to the stuff that he copies out of the Onion, or the stuff he gets out of his old Mad Magazines? Can you be a little more specific?

Generally, when he talks about specifics with respect to green energy, for example, he cites credible publications or knowledgeable sources.

Not doomer blogs like zerohedge, or his own nonsense he is selling copies of.

Get it?

As far as the informal exchanges -- you call people enough names, in the style of a five year old, that you earn all the sarcasm, etc. you get around here.
Given the track record of the perma-doomer blogs, I wouldn't bet a fast crash doomer's money on their predictions.
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Re: Economics vs. ETP

Unread postby Cog » Thu 07 Dec 2017, 19:31:51

Remind me of grade school notes:

Do you like me

Yes

or

No
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Re: Economics vs. ETP

Unread postby rockdoc123 » Thu 07 Dec 2017, 20:04:01

$this->bbcode_second_pass_quote('', 'T')he industry is now replacing less than 8% of the reserves that it is extracting. Water breakthrough occurs at an average of 6.9 years for offshore, or the point where the field is 79% depleted. Existing producing fields are at least on average that old. Replacement has been low for more than a decade. Production growth from these fields can be expected to continue for no more than a year or so. 


Once again demonstrating you don’t listen and don’t understand. This is the umpteenth time you have been corrected on this claim.

According to the Ernst & Young US oil and gas reserves study for 2017 Oil replacement rates were 128% excluding revisions (P1 dropped to lower category as a consequence of price) for 2016. The three year average replacement rate of produced reserves was 158% and the five year average replacement rate was 190%. This is measured amoungst the top 50 US oil and gas companies and includes Exxon, Shell and all the major shale players. As an example CHK had a reserve replacement rate excluding revisions of 486% in 2016

Your 6.9 year number is complete BS. Please provide us with the reference for that. And if you once again point to a paper about water flood injection as you have every other time you have been questioned we will all get to once again point out you haven’t a clue what you are talking about. Wytch farm as an example began production in 1978 and didn’t even reach peak until 20 years later. It was still producing 17,000 bopd 30 years after discovery. And water production at Wytch farm did not even start until 8 years after first production and remained low for decades. And what happens after water break through from a natural water drive....nothing other than the Operator has to handle more water. Offshore this isn't that problematic as at even very high water cuts the produced water can be treated and then released at the seabed.

As I have said time and time again no two reservoirs are identical and hence there is no rule of thumb for when water breakthrough will occur if a field has strong natural water drive nor, in fact, is there a guaranty that it has a natural water drive at all.
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Re: Economics vs. ETP

Unread postby radon1 » Fri 08 Dec 2017, 03:11:02

$this->bbcode_second_pass_quote('onlooker', '
')From what I have heard, the running average for the WTI price is STILL running below the Etp MAP.


Which running average? The one over the last couple hundred years? It is probably pretty close to zero all the time, so yeah, it is running below almost everything.
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Re: Economics vs. ETP

Unread postby BahamasEd » Fri 08 Dec 2017, 06:51:36

$this->bbcode_second_pass_quote('', 'A')ccording to the Ernst & Young US oil and gas reserves study for 2017 Oil replacement rates were 128% excluding revisions (P1 dropped to lower category as a consequence of price) for 2016.


you do realize the ETP is modeling world oil output of which the US only produces about 10% of the daily total.
The total energy cost of producing and delivering a gallon of gasoline to the end consumer must be less than the energy in a gallon of gasoline for it to be commercially viable.
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Re: Economics vs. ETP

Unread postby vtsnowedin » Fri 08 Dec 2017, 07:24:26

$this->bbcode_second_pass_quote('radon1', '')$this->bbcode_second_pass_quote('onlooker', '
')From what I have heard, the running average for the WTI price is STILL running below the Etp MAP.


Which running average? The one over the last couple hundred years? It is probably pretty close to zero all the time, so yeah, it is running below almost everything.

The one they chart is the 52 week average of weekly close of WTI (NASDAC I believe).
Each week where WTI is above $55 brings that line closer to the MAP line but it is all meaningless as no great event will happen when this fictional line is crossed.
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Re: Economics vs. ETP

Unread postby marmico » Fri 08 Dec 2017, 08:10:42

$this->bbcode_second_pass_quote('', 'y')ou do realize the ETP is modeling world oil output of which the US only produces about 10% of the daily total.


Firstly, are you serious? The only thermodynamic thingie that the ETP models is a 2008 Oklahoma well. The ETP Weasel ran out of EIA data almost 10 years ago.

https://www.eia.gov/dnav/pet/pet_crd_welldep_s1_a.htm

Have the ETPers taken up the collection plate so that the ETP Weasel can pay kublikhan $1250 on the 2017 wager? The ETP Weasel was arithmetically eliminated 3 weeks ago, unless you doomtards think that the WTI price might be negative between now and calendar year end.

Secondly, if you paid any attention to the ETP MAP data set you would realize that it refers to a maximum price (page 33) and the maximum price is beginning of the calendar year (page 17). In other words, the January 1, 2018 WTI price of $41.16 is a discontinuity relative to January 1, 2017 WTI price of $54.18 for 52 week moving average purposes unless the declining ETP MAP line (your blue dashed line) is drawn through the magenta dot prices.

Loren Soman, SumYunGai, futilist, whatever drew the proper ETP MAP line 15 months ago.

On that basis, the ETP MAP has been broken on a daily basis since late July, 2017.
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Re: Economics vs. ETP

Unread postby shortonoil » Fri 08 Dec 2017, 10:50:12

$this->bbcode_second_pass_quote('', '')$this->bbcode_second_pass_quote('', '
')According to the Ernst & Young US oil and gas reserves study for 2017 Oil replacement rates were 128% excluding revisions (P1 dropped to lower category as a consequence of price) for 2016.



you do realize the ETP is modeling world oil output of which the US only produces about 10% of the daily total.


you do realize that the 128% they are talking about was all shale oil. A substance with decline rates 100 times faster than the conventional fields the US was built with. It is an industry that has never turned a positive free cash flow. It is an industry were every well drilled is a stripper in five years, and an industry that will never repay the capital that it took to build it. 128% of nothing is still nothing!
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Re: Economics vs. ETP

Unread postby rockdoc123 » Fri 08 Dec 2017, 11:39:56

$this->bbcode_second_pass_quote('', 'y')ou do realize that the 128% they are talking about was all shale oil. A substance with decline rates 100 times faster than the conventional fields the US was built with. It is an industry that has never turned a positive free cash flow. It is an industry were every well drilled is a stripper in five years, and an industry that will never repay the capital that it took to build it. 128% of nothing is still nothing


The fast decline rates in shales last no more than 36 months (hyperbolic decline) after which the wells enter into a long period of exponential decline. These wells payout (i.e. all the capex invested) in the first year generally which is one of the reasons they are attractive. From that point on they keep producing and keep churning out cash. As to never turning positive free cash flow once again, I need to point out that you and the other idiot here who has a blog site do not understand oil and gas company financials nor how to properly read a balance sheet. When you remove all non-cash accounting items most of the shale players are generating positive cash flows and have been for the past two years and before the price crash. Never repay the capital? What do you not understand about payout in one years time?

It never ceases to amaze me how someone with no background in the oil and gas industry feels comfortable pointing out that the hundreds of oil and gas executives, Board members, and investors who have been making this business work for decades apparently don’t understand they aren’t making any money and that it is all a losing proposition. Apparently, you seem to think you are brighter than all of these folks many of whom have become extremely wealthy through their petroleum-related businesses and also have probably contributed to society several fold more times than you through bringing petroleum products to a populace in need and helping to improve the overall standard of living.
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Re: Economics vs. ETP

Unread postby rockdoc123 » Fri 08 Dec 2017, 11:51:11

$this->bbcode_second_pass_quote('', 'y')ou do realize the ETP is modeling world oil output of which the US only produces about 10% of the daily total.


The E&Y study is focused on US producers but because many of them are the likes of Exxon and Shell who don't always report segregated financials to the level needed for the study purposes reserve replacement from outside of the US is included.

As well in the study, E&Y points out that although it is focussed on the US there are similar replacement rates globally.

You can see this for yourself by going to the BP Statistical Review. In 1980 global R/P (reserves replacement measured in years based on produced reserves and reserves replacing those) was 29 years in 2005 it was 46 years and in 2016 it was 51 years. You do not get this pattern unless you are more than completely replacing produced reserves.
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Re: Economics vs. ETP

Unread postby marmico » Fri 08 Dec 2017, 13:50:10

Year end 2015 US proved oil reserves declined year over year. The level is about the same as in 1975. The 2016 EIA data should be published shortly.

https://www.eia.gov/dnav/pet/pet_crd_cplc_dcu_NUS_a.htm

https://www.eia.gov/naturalgas/crudeoil ... serves.pdf
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Re: Economics vs. ETP

Unread postby rockdoc123 » Fri 08 Dec 2017, 14:07:21

$this->bbcode_second_pass_quote('', 'Y')ear end 2015 US proved oil reserves declined year over year. The level is about the same as in 1975. The 2016 EIA data should be published shortly.


most of that was from reserve revisions. BP already published the global study which includes 2016 reserves which are up. The point is that production is being replaced. Historically since 1980 it has been replaced year on year with the exception of 2 years, on of which is 2015 (again due to revisions).
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