Posted on 07/06/2008 12:13:17 PM PDT by Donald Rumsfeld Fan
"Even if drilling works, it'll take a decade or more for the oil to flow."
This is quite an argument coming from the Democratic Party, which has made keeping oil off the market a linchpin of its energy policy for decades.
If President Clinton hadn't vetoed the idea of drilling in ANWR back in 1995, we'd have that oil on the market today. Ditto if Congress had approved ANWR drilling in 2002, when President Bush requested it.
Even so, the larger point is false anyway. New oil will be flowing in some cases within three to four years, according to industry estimates. But the impact on prices will be immediate. Why? Because markets would suddenly have to discount future oil prices for the expected gain in oil supply. That would cause oil prices, especially in futures markets, to drop.
By the way, this isn't just conjecture. President Reagan, within a week of his inaugural in 1981, removed domestic controls on oil. Energy prices began tumbling almost immediately, with oil falling from $34 a barrel in early 1981 to just $11 by 1986.
It worked before, and it'll work again
(Excerpt) Read more at investors.com ...
Shale oil deposits. These were not producing oilwells to begin with. Conventional wells are not “capped” they are “plugged”.
Exactly. If wells were simply capped as many think of the term, our aquifers would be severely contaminated with leaked crude oil
I never want to come across as condescending, but at soon as someone here refers to “capped” oil wells, you might as well quit reading because they’re just spouting off about something they know nothing about.
The only reason for plugging or abandoning an oil well is because it’s no longer producing enough oil to make a profit. It’s true that at today’s prices, the amount of oil it must produce is less to be profitable, but it’s simply not the case that you can “uncap” an oil well and start counting the profit.
There’s a huge upfront investment to that, and I don’t know of anyone who has thought it made good sense to re-enter a well that can make only three barrels of oil a day.
Keep in mind that these wells are also likely to be producing hundreds of barrels of water a day in addition. That’s not fresh water you can just pour on the ground. It’s contaminated water or salt water, and you have to pay to have someone truck it off and inject it into a disposal well. Not cheap.
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