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Posted on 07/14/2015 9:46:17 AM PDT by bananaman22
What OPEC countries fear most is a follow-up technological revolution that will lead to a second oil boom in the U.S., and that fear is now being realized.
A technological revolution spurred the U.S. oil boom that resulted in the greatest increase in domestic oil production in a century, and while that has stuttered in the face of a major oil price slump and an OPEC campaign to maintain a grip on market share, the American response could be another technological revolution that demonstrates that the first one was merely an impressive embryonic experiment.
It’s not only about shale now—it’s about reviving mature oil fields through advancements in enhanced oil recovery, potentially opening up not only new shale fields, but older fields that have been forgotten.
There are myriad gloom-and-doom stories about what is often alluded to as a short-lived oil boom in the U.S. But what many fail to understand is that revolutions of this nature are phased, with the advent of new technology typically followed by a temporary halt in progress while we study the results and come up with something even better.
(Excerpt) Read more at oilprice.com ...
Gasoline is over 5bucks a gallon in so cal
The oil guys can correct me, but I remember reading that we only retrieve lass than 20% of available oil in a typical drill / pump operation. So there’s significant oil left to be extracted by secondary means.
move to Texas ;-)
“So there’s significant oil left to be extracted by secondary means.”
Secondary could mean a lot of things. ( ; )
Three Phases Of Oil Recovery - ::China Oilfield technology:: *
www.chinaoilfieldtech.com/oilrecovery.htmlProxy Highlight
Oil recovery refers to the processes by which crude oil is extracted from beneath the Earth’s surface. Oil recovery can be categorised into three phases:
Enhanced Oil Recovery, Secondary, and Tertiary Recovery *
www.reviewreport.org/ enhanced-oil-recove...Proxy Highlight
Enhanced Oil Recovery, Secondary, and Tertiary Recovery. The energy debate ... The next time you hear the solar power versus oil heat up, you would ... Oil & Gas Microcap Inventory Play – Interview With Scott Masse, CEO Dynamic
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It's kinda like saying "men and women fall into 2 categories, male and female".
2.39 here in Indiana.
But you’re saving the planet with state Cap N Tax
As USAToday put it....
Republicans did a lot of talking about “drill baby drill” but it was Obama that made it happen.
(and most of the voters will actually believe that)
California still has refinery problems.
ExxonMobil importing Asian gasoline for the first time since LA-area refinery explosion
http://www.platts.com/latest-news/shipping/houston/exxonmobil-importing-asian-gasoline-for-the-first-21642766
It is why the West Coast is processing less crude oil than in recent years.
http://eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=WCRRIP52&f=W
And is importing more Refined Products from other nations and from other areas of the country.
http://eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=WTXIM_R50-Z00_2&f=W
http://eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=MPEMXP5P41&f=M
http://eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=MPEMXP5P31&f=M
It is the California special recipe that makes it more difficult and more expensive to source gasoline from outside sources when conditions are upset. The special blend must be made outside of normal runs.
This article says that two new technologies (Plasma pulse and CO2 injection, will produce a lot more oil from old fields that have stopped producing (21 billion extra barrels). Both are already working cost effectively.
Other articles on that site (oilprice.com), highlight other technical innovations that are reducing the cost to produce, or opening new reserves.
The oil rig count in the US has stopped falling, and is actually up 17 in the last couple of weeks.
As they report elsewhere:
“The U.S. “fully burdened exploration and production “break-even” cost is now $51 per barrel, and falling fast. Furthermore, with hundreds of American oil companies having already paid the exploration lease acquisition costs to accumulate tens of thousands of drilling sites, the production-only break-even cost for positive cash-flow is about $29 a barrel. After tacking on a 9 percent profit, U.S. domestic oil companies are now incentivized to produce domestic oil any time the price is above $32 a barrel.
The operating cost base for drilling and producing shale oil has followed the oil price down. If these figures from Breitbart are anywhere close to correct then many OPEC members should be extremely concerned. Can they run their social services on $30 per barrel?”
Correct. Each phase can recover about 20% to 25%. The problem is that secondary and tertiary enhanced recovery methods are currently more expensive to do. They tend to add about $20 to $25 a barrel to the break even point.
I have been researching for work some new technology that may begin to bring the price for enhanced recovery down, but the big players in EOR in the US have massively slashed budgets this year. Primarily in this area.
It’s just like the credit Clinton gets for the 1990s economic grown.
Like Obama with fossil fuel energy, Clinton didn’t make that happen. He just had no ability to stop it.
For some utterly obscure reason, most analyses of this tech I’ve seen assume that its use will remain more or less limited to North America.
Seems unlikely to me. The more widely oil production is spread across the world, the less power and wealth the OPEC countries have. A very good thing, IMO.
“most analyses of this tech I’ve seen assume that its use will remain more or less limited to North America.
Seems unlikely to me.”
True. The article mentions a Russian Tycoon who is investing in the Plasma Pulse technology, which is well suited to old Russian oilfields.
OPEC may not be able to recapture its glory days again, of sustained prices over $100/bbl.
We still have the best private property rights in the world vis a vis mineral rights. We have a strong capital system in place and good credit markets. We’re also still basically a profit motivated people with a relatively free market. Elsewhere in the world not so much and that is a major driver of oil success.
If the above holds true and oil for Americans becomes profitable below the lowest cost producer Saudi Arabia, then it’s lights out in many parts of the world as we literally squeeze the graft out of the system. Imagine Cook County Democrats in charge of US oil production (think Obama and cronies) and that’s the competition.
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