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Why Shale Fracking Is An Economic Game-Changer That Cannot Be Overhyped
Business Insider ^ | Jan. 22, 2013, 6:12 PM | Rob Wile

Posted on 02/23/2013 1:24:14 PM PST by Ernest_at_the_Beach

Yesterday, we published a presentation by oil analyst Arthur Berman suggesting the potential of fracking to extract fossil fuels buried in shale rock has been way overhyped.

But there are many who would argue that the assumptions Berman makes are off the mark.

Using data from the Energy Information Administration and Canadian energy consultancy ITG, we have put together the counter-argument to Berman's thesis.


(Excerpt) Read more at businessinsider.com ...


TOPICS: Business/Economy; Canada; Culture/Society; Editorial; US: California; US: North Dakota
KEYWORDS: california; canada; energy; northdakota

1 posted on 02/23/2013 1:24:22 PM PST by Ernest_at_the_Beach
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To: Ernest_at_the_Beach

But the cost of fracking means that fuel prices must remain high to keep it economical to do.


2 posted on 02/23/2013 1:33:28 PM PST by bigheadfred
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To: bigheadfred

And the cost of fuel will rise without it.


3 posted on 02/23/2013 2:03:28 PM PST by SunkenCiv (Romney would have been worse, if you're a dumb ass.)
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To: AdmSmith; AnonymousConservative; Berosus; Bockscar; ColdOne; Convert from ECUSA; Delacon; ...

Thanks Ernest_at_the_Beach.


4 posted on 02/23/2013 2:04:33 PM PST by SunkenCiv (Romney would have been worse, if you're a dumb ass.)
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To: Ernest_at_the_Beach
Break even on Fracking is $65 a barrel?

Holy Shmoly!

Break even on Saudi oil is under $10.

I did a little more research...

The break even on USA off shore oil is around $65, too.

I had no idea costs are that high.

5 posted on 02/23/2013 2:07:04 PM PST by zeestephen
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To: SunkenCiv

Right. I am all for fracking. But it won’t be some Panacea that is going to bring back days of cheaper gas.


6 posted on 02/23/2013 2:26:57 PM PST by bigheadfred
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To: bigheadfred

Even if the price does not come down much it will still be money flowing into our country not some terrorist supporting country.


7 posted on 02/23/2013 2:49:05 PM PST by jimpick
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To: jimpick

Right. I work for a general contractor in their cabinet shop. Big boss has been spending a lot of time in North Dakota. Trying to get in the housing game up there. Among other things. They are trying to seal a deal on a group of duplexes that would feed us for over a year. And times have been lean. A solid year would be good.


8 posted on 02/23/2013 3:00:30 PM PST by bigheadfred
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To: Ernest_at_the_Beach

Well I believe natural gas has dropped from above $10 down to less than $3 per MCF since fracking really got going. So gasoline is not dropping, apparently. NatGas is WAY down.


9 posted on 02/23/2013 3:15:13 PM PST by willgolfforfood
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To: zeestephen

Why don’t we add in the cost of fighting two wars to preserve the Saudi oil field$


10 posted on 02/23/2013 3:45:53 PM PST by South Dakota (shut up and build a bakken pipe line)
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To: bigheadfred
But the cost of fracking means that fuel prices must remain high to keep it economical to do.

Having fracking puts a ceiling on how high OPEC oil prices can go.

11 posted on 02/23/2013 3:47:45 PM PST by PapaBear3625 (You don't notice it's a police state until the police come for you.)
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To: PapaBear3625

Believe me, Obama and his Marxist lackeys will find a way to torpedo it.


12 posted on 02/23/2013 3:52:39 PM PST by huckfillary (qual tyo ta)
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To: bigheadfred

It is true- fracking ain’t free. Seems like this was already discussed today, but yes, in order for a well to be economical certain production targets have to be met due to extraction and other costs. But the good news sucessful operators are learning how to levarage new processes or refining techniques either independently thru experience and/or via sharing of institutional knowledge in a given area.

Not all formations are the same and there is a learning curve involved in new plays. But the key thing is they are getting more effecient and the extraction costs will drop, but how fast it declines is unkown. We will see the value at the pump sooner or later. Alternatively we could leave all that oil locked up in formation and unreachable via tradtional vertical drilling and keep playing sweetly with our ME enemies forever. And wating for cold fusion to come to fruition, i suppose.


13 posted on 02/23/2013 4:23:35 PM PST by Dysart
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To: Ernest_at_the_Beach

He is wrong about the decline rate, especially on Eagle Ford wells. Most are still producing at a shallow decline between 50 and 100 BOPD in the sweet spots after a couple years. And with wells IP’ing around 2000 BOPD, the payout is only a couple months which is the most important factor.


14 posted on 02/23/2013 4:56:05 PM PST by crusty old prospector
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To: willgolfforfood
Auto Gasoline requires a trip thru a Refinery,....none have been built in this country in 30 + years,...many have been closed.

At the moment Crude Oil is sitting in tankers around the globe and in Cushing Oklahoma Tank farms.

15 posted on 02/23/2013 6:15:35 PM PST by Ernest_at_the_Beach ((The Global Warming Hoax was a Criminal Act....where is Al Gore?))
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Oh ,...and refineries that can handle heavy crude like that from ?Canada and Venezuela don't handle light crude and vice versus....
16 posted on 02/23/2013 6:18:19 PM PST by Ernest_at_the_Beach ((The Global Warming Hoax was a Criminal Act....where is Al Gore?))
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To: bigheadfred

It’s “an economic game-changer” in part because the money will stop going to jihadists paying for flight lessons and box-cutters.


17 posted on 02/23/2013 7:27:40 PM PST by SunkenCiv (Romney would have been worse, if you're a dumb ass.)
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To: South Dakota

Re: “Plus, the cost of two wars.”

Yes - I did overlook that.


18 posted on 02/23/2013 9:44:22 PM PST by zeestephen
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To: thackney

Ping.


19 posted on 02/24/2013 1:23:23 PM PST by Army Air Corps (Four Fried Chickens and a Coke)
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