Karl Francis

Whither Oil Prices?

@gigem
The petrobras cost information is from 2008.
Petrobras knows better than others what the deep water costs will be. They have done a lot of drilling, build the infrastructure and started producing. 30$/bbl are their total cost estimates,once a field is in full production.

Besides light crude oil, there are plenty of unconventional oil alternatives. For example GTL (gas to liquids - proven technology, existing plants. conversion costs per BOE: 15-20 US$. Half of known global natural gas reserves are stranded - not in production actually.

Whither Oil Prices?

The costs of deep water production are overstated.
Finding costs are on a downward learning curve.
Petrobras, the leader in deep water drilling and production, calculates with lifting costs of $8/barrel and total costs of a maximum of $30/barrel, once a deep water field is developed. Deep water oil reserves are enormous and will determine the marginal costs of light crude oil production in the next 15 to 20 years