[kjam22]

Hydraulic fracturing, combined with horizontal drilling, lower the cost of production per barrel. It does not raise the cost. It lowered the cost to produce enough to make it economic to produce.

That's simply not correct. Think of the cost to drill a vertical, traditional well and produce it. Compare that to the cost to drill and produce a horizontal well through a shale formation. Yet, the reserves are similar. We do not drill "cheap" oil here anymore because of the expense in shale drilling.

That is why the middle east can produce those wells in a $40 a barrel market and be profitable, while all of our shale drillers have cut back on drilling. As the middle east begins needing to produce from formations besides sand, their costs will be more like ours.... and that will help companies drilling here in the US.

[thackney]

Think of the cost to drill a vertical, traditional well and produce it. Compare that to the cost to drill and produce a horizontal well through a shale formation. Yet, the reserves are similar.

The barrels produced by each, in the same play, are greatly different. Comparing cost per well do not have meaning for investment. They sell oil, not wells. Total oil in the ground does not have meaning to the investment. Only the technically and economically recoverable amount.

In the same play, the horizontal, hydraulically fractured well is done because it produces oil for less cost per barrel, or it isn't done.