I didn't know if using the timer was an effective way to stay below out of that curve. Sounds like it is.
Sounds like there are several reasons to not have the pump running as someone drives by, while still keeping the well in operation.
Posted on 10/27/2014 7:49:15 AM PDT by SeekAndFind
Crude oil just broke $80.
In morning trade on Monday, the price of crude oil fell below $80 a barrel for the first time since mid-2012 as energy prices continue to plummet around the world.
The most recent drop in oil, which has been a bear market since topping out at about $107 during the summer, follows a cut in oil-price expectations from Goldman Sachs' Jeff Currie over the weekend.
Currie took his oil-price forecasts for WTI Crude to $75 a barrel in the first quarter of 2015 and to $70 a barrel in the second quarter of next year.
Longer-term, Currie expects WTI prices to stabilize near $80 a barrel, and Currie said that "uncertainty around the required price to slow down US shale production growth is a key risk to our forecast."
Currie's forecast relies on three key reasons:
* We have greater confidence in the scale and sustainability of US shale oil production. This implies that the global cost curve has shifted lower and that cost deflation is sustainable.
* We forecast that accelerating non-OPEC production growth outside North America will outpace demand growth, leaving the global oil market oversupplied.
* We believe that OPEC will no longer act as the first-mover swing producer and that US shale oil output will be called upon to fill this role.
(Excerpt) Read more at businessinsider.com ...
In the week since, gas has dropped a whopping nickel a gallon by me while the price of oil per barrel continues to go down.
Right, we're not getting ripped off by big oil. No pricing manipulation going on here! Why, that can't be the case when EVERYONE raised their prices at the same time and EVERYONE lowered the price a whopping nickel AT THE SAME TIME! (/sarc)
Can you conceive of a well already drilled and in production that didn’t pay to keep pumping at $80?
Where are you located?
Depends on the wells and what they are producing.
If you have to produce a lot of salt water to get the oil your electric cost plus the salt water disposal cost, even with your own disposal well, can take a bite out of your ass quick.
Most of those wells aren’t shut in they are just put on timers so you can keep the lease without having to pay shut in cost to the mineral owner.
Thanks for that. I wasn't thinking about that side of it. But I understand that quantity can be large relative to the oil.
just put on timers so you can keep the lease
Okay, that makes more sense. Thanks for the info.
You can generally tell if a well is on a timer by looking at the polish rod.
If it’s real shiny and doesn’t have a coat of dust on it when not pumping, it’s probably on a timer and pumping when you don’t see it.
Are wells sometimes placed on timers due to flow conditions and not associated with cost?
Yep.
Sometimes you can out-pump the fluid coming into the well so you just put it on a timer and pump maybe 15-30 minutes then let it sit for an hour or 2 or however long it takes for the fluid to come in then pump again.
Is that also done to keep down the water draw?
I live 30 miles South West of Shitcago.
Yes, the oil is on top of the water so you are pumping all the oil that is being produce so you don’t build a head of oil over the top of your pump.
You try to hit the sweet spot where you keep a small oil head over your pump so you don’t pump dry but not so much that you have to pump a lot of water to get to the oil head.
I didn't know if using the timer was an effective way to stay below out of that curve. Sounds like it is.
Sounds like there are several reasons to not have the pump running as someone drives by, while still keeping the well in operation.
Lower prices on shipped goods (everything)
My costs for shipping just keep going up. Probably union contracts or something like that.
Interesting the average in the area did not jump like that.
Keep this in mind; if the cost of a barrel of oil goes under $70.00 the Russians start to feel it. When that happens who knows what happens; but with Obama in “charge” it won’t be good.
What are some of the efficiencies that the industry has added? How will going with a pipeline help? Allowing exports?
You might get more oil if you pump 24/7 and move the hell out of fluid, but the cost of electricity, salt water disposal, and the biggy the cost of wear and tear on the pump, rods, and tubing plus the cost of workover rigs to get pumping again also has to be considered.
You can actually make more profit by pumping less.
The commies in Venezuela are going to be in a tight spot. They won’t have much wealth to spread around.
Would you like me to upload the picture from my phone which has the date stamp on it? Gas Buddy also has the history, btw. Look at prices in Orland Park/Tinley Park/Homer Glen (all in Illinois) the last two weeks.
Yesterday I paid $2.78/gal in Morris IL on my way back from Starved Rock. Gas price by me is still $3.21/Gal as of this morning.
Sounds to me what you want to blame on “big oil” is the choices of a local station operator.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.