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To: saganite
New sources of oil like tar sands and shale oil need prices above the $50 range to be profitable.

I basically hijacked another thread disputing that so I might as well dispute it here too. The cost of oil sand, oil shale, coal based gas, etc, are all based on abundant and subsidized (in many cases free) energy. Just like paying farmers to waste energy planting, fertilizing and harvesting corn, these schemes are basically just ways for people to make money from the government. They don't all waste energy as transparantly as ethanol, but they all have subsidies needed for profitability. A basic rule of thumb for an energy source is it should use its own energy to produce itself in at most 1:2 ratio. That allows for other energy inputs like the workers and machines and still leaves some room for profit.

The bottom line, some energy sources are not profitable even at infinity per barrel, and most are double the current crude price (i.e. $140/barrel today).

18 posted on 05/17/2006 2:43:10 PM PDT by palmer (Money problems do not come from a lack of money, but from living an excessive, unrealistic lifestyle)
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To: palmer

Everything I've read says tar sands are profitable above $30 a barrel and the greatest problem there is recovering the huge sunken costs of setting up the recovery and refining process. Since oil shale isn't even to the production phase yet there's only speculation as to it's cost but I've read it would be profitable to extract it at a price above $35 a barrel.

I'm not aware of subsidies for these in the category of subsidies for ethanol but would be interested in your info in that regard.


19 posted on 05/17/2006 2:48:20 PM PDT by saganite (Billions and billions and billions-------and that's just the NASA budget!)
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