happycajun's Comments RSS Syndication from SeekingAlpha.com http://seekingalpha.comuser/168859/comments http://seekingalpha.com/article/154616-why-are-natural-gas-producers-expanding-production-so-aggressively?source=feed#comment-619980 619980
Madrejesica - oil & gas property rights are governed by state law, hence each state has its own set - but there is a significant similarilty in how the operating companies and landowners have approached the legal issues. Regarding the shut-in provisions, the typical lease provides for a "shut-in royalt" that holds the lease when a lease is shut-in awaiting facilities. Following is an example:

"should Lessee be unable to operate said well because of lack of market or marketing facilities or governmental restrictions, then Lessee's rights may be maintained beyond or after the primary term without production of minerals or further drilling operations by paying Lessor as royalty a sum equal to one dollar (1.00) per acre of land covered hereby per year, the first payment being due . . ."

There are a variety of general lease forms that have been used over time, and you must read each one to make sure what it says! If you have a significant sized tract (forty acres or more) you would be well advised to have an oil & gas lawyer take a look at things for you before you sign. My VERY generalized explanation above is just that - generalized. Whole legal treatises on the subject of Oil & Gas law such as "Williams and Meyers" (which my old friend Pat Martin edits) are written on the subject, so this is an over-simplification at best!]]> Fri, 07 Aug 2009 12:56:14 -0400
Madrejesica - oil & gas property rights are governed by state law, hence each state has its own set - but there is a significant similarilty in how the operating companies and landowners have approached the legal issues. Regarding the shut-in provisions, the typical lease provides for a "shut-in royalt" that holds the lease when a lease is shut-in awaiting facilities. Following is an example:

"should Lessee be unable to operate said well because of lack of market or marketing facilities or governmental restrictions, then Lessee's rights may be maintained beyond or after the primary term without production of minerals or further drilling operations by paying Lessor as royalty a sum equal to one dollar (1.00) per acre of land covered hereby per year, the first payment being due . . ."

There are a variety of general lease forms that have been used over time, and you must read each one to make sure what it says! If you have a significant sized tract (forty acres or more) you would be well advised to have an oil & gas lawyer take a look at things for you before you sign. My VERY generalized explanation above is just that - generalized. Whole legal treatises on the subject of Oil & Gas law such as "Williams and Meyers" (which my old friend Pat Martin edits) are written on the subject, so this is an over-simplification at best!]]> http://seekingalpha.com/article/154616-why-are-natural-gas-producers-expanding-production-so-aggressively?source=feed#comment-619578 619578
The majors recruit the finest engineering, geology and mba programs in the world, looking for the best potential. I have known many with undergrad degrees from US Naval Academy, US Military Academy, Texas, Texas A&M, Rice, Oklahoma, MIT, Harvard, Michigan, Penn, Duke, Purdue - just to name a few who I know who made it to the top ranks of E&P businesses. They then put them in the trenches - ALWAYS analyzing the economics of any investment decision. ALWAYS. The independants tend to hire from the majors - because the majors are better able to afford to train and develop the raw recruit. The young professional is taught about legal and regulatory aspects of the business - and HEAVILY INDOCTRINATED to NOT do anything wrong or unethical. I know some armchair quarterbacks will jear this assertion, but the majors all have a culture of being ethical, honest businesses - WAY more so than what I have seen from the wallstreet financial crowd.

There some bad apples, as in any business, but after the last great oil boom/bust, and all of the scrutiny focused on the industry over the nearly forty years I've been around it - the culture is shareholder focused, while operating legally and ethically. Anyone have some specific factual charges - take them to the SEC.]]> Fri, 07 Aug 2009 09:48:10 -0400
The majors recruit the finest engineering, geology and mba programs in the world, looking for the best potential. I have known many with undergrad degrees from US Naval Academy, US Military Academy, Texas, Texas A&M, Rice, Oklahoma, MIT, Harvard, Michigan, Penn, Duke, Purdue - just to name a few who I know who made it to the top ranks of E&P businesses. They then put them in the trenches - ALWAYS analyzing the economics of any investment decision. ALWAYS. The independants tend to hire from the majors - because the majors are better able to afford to train and develop the raw recruit. The young professional is taught about legal and regulatory aspects of the business - and HEAVILY INDOCTRINATED to NOT do anything wrong or unethical. I know some armchair quarterbacks will jear this assertion, but the majors all have a culture of being ethical, honest businesses - WAY more so than what I have seen from the wallstreet financial crowd.

There some bad apples, as in any business, but after the last great oil boom/bust, and all of the scrutiny focused on the industry over the nearly forty years I've been around it - the culture is shareholder focused, while operating legally and ethically. Anyone have some specific factual charges - take them to the SEC.]]> http://seekingalpha.com/article/154616-why-are-natural-gas-producers-expanding-production-so-aggressively?source=feed#comment-619521 619521
Second - the "why" wells are being drilled with prices down is more complex than you characterize. One must look at oil & gas law and how mineral rights are acquired to understand why an oil or gas lease is a "use it or lose it" proposition. When a landowner leases his/her minerals, it is by way of an agreement in written form that stipulates that the lessee has a limited amount of time to drill a well, or the leasehold rights revert back to the land owner. In the Haynesville, for example, it common for leases to provide that the lessee must drill a well in two years, or the lease goes away. There is usually an option to "renew" the lease for an amount of money generally equal to the original lease payment or "bonus" that was the consideration for the lease initially. The lease bonus in the Haynesville has been in the $5,000 to $10,000 per acre range generally. If gas and condensate are produced, then the lessor gets a percentage of the gross production at the wellhead, typically 25% of the volume - which the producer generally markets for the owner, who then gets the $$ that his 1/4 of the gas is sold for.

Now, to put this in an economic context. The basic "unit" being formed in the shales is the section - or a 640 acre nominally square area. This unit is developed by a single horizontal well that is spudded (the surface penetration of the drill bit) near the center of one side of the square, and which goes down vertically to the shale formation, then "kicks" horizontal and runs about a mile - this is the section of the well that is "completed" - where the gas flows from the rock into the tubing, then to the surface.

The lease bonuses for 640 acres is a sunk cost of about $3 - 6 million. A well costs a little more than that. If you don't drill, you lose the lease, or have to pony up another $3-6MM to hold the lease - which you will still lose if you don't drill - all you are buying is time. Having shelled out the $$$ for a lease, and or for a well - it is simple matter of cash flow that you have to generate revenue to produce some return on the investment. The lease also has shut in provisions, which require that a lease be produced once a well is drilled, or it reverts to the land owner - if a lease is shut in more than thirty days - you can lose the lease.

The above is much simplified - but it shows that the economics and risks are more complex than you characterize. This is why the upstream E&P business is best analogized as a game of stud poker - you have to ante up at each stage of the game, and you don't know if you have won or lost until the last card is dealt.]]> Fri, 07 Aug 2009 09:27:53 -0400
Second - the "why" wells are being drilled with prices down is more complex than you characterize. One must look at oil & gas law and how mineral rights are acquired to understand why an oil or gas lease is a "use it or lose it" proposition. When a landowner leases his/her minerals, it is by way of an agreement in written form that stipulates that the lessee has a limited amount of time to drill a well, or the leasehold rights revert back to the land owner. In the Haynesville, for example, it common for leases to provide that the lessee must drill a well in two years, or the lease goes away. There is usually an option to "renew" the lease for an amount of money generally equal to the original lease payment or "bonus" that was the consideration for the lease initially. The lease bonus in the Haynesville has been in the $5,000 to $10,000 per acre range generally. If gas and condensate are produced, then the lessor gets a percentage of the gross production at the wellhead, typically 25% of the volume - which the producer generally markets for the owner, who then gets the $$ that his 1/4 of the gas is sold for.

Now, to put this in an economic context. The basic "unit" being formed in the shales is the section - or a 640 acre nominally square area. This unit is developed by a single horizontal well that is spudded (the surface penetration of the drill bit) near the center of one side of the square, and which goes down vertically to the shale formation, then "kicks" horizontal and runs about a mile - this is the section of the well that is "completed" - where the gas flows from the rock into the tubing, then to the surface.

The lease bonuses for 640 acres is a sunk cost of about $3 - 6 million. A well costs a little more than that. If you don't drill, you lose the lease, or have to pony up another $3-6MM to hold the lease - which you will still lose if you don't drill - all you are buying is time. Having shelled out the $$$ for a lease, and or for a well - it is simple matter of cash flow that you have to generate revenue to produce some return on the investment. The lease also has shut in provisions, which require that a lease be produced once a well is drilled, or it reverts to the land owner - if a lease is shut in more than thirty days - you can lose the lease.

The above is much simplified - but it shows that the economics and risks are more complex than you characterize. This is why the upstream E&P business is best analogized as a game of stud poker - you have to ante up at each stage of the game, and you don't know if you have won or lost until the last card is dealt.]]> http://seekingalpha.com/article/153353-oil-is-still-the-key-to-u-s-economic-future?source=feed#comment-613336 613336 Mon, 03 Aug 2009 15:43:28 -0400 http://seekingalpha.com/article/152808-exxon-misses-as-production-drops?source=feed#comment-609447 609447
So, it is inevitable that the current low prices will result in less exploration, less development, less reserve replacement, continued depletion, and ultimately - less oil available..... and higher prices. If Exxon's stats show it after less than one year of seriously down prices - it is true of the industry at large - simple Oil & Gas Econ 101. ]]> Fri, 31 Jul 2009 08:38:21 -0400
So, it is inevitable that the current low prices will result in less exploration, less development, less reserve replacement, continued depletion, and ultimately - less oil available..... and higher prices. If Exxon's stats show it after less than one year of seriously down prices - it is true of the industry at large - simple Oil & Gas Econ 101. ]]> http://seekingalpha.com/article/152191-oil-and-gas-producers-spending-enough-to-grow-production-through-2010?source=feed#comment-606944 606944
Many old fields that were super giants in their day continue to produce at MUCH lower rates for years after their prime days. I remember when we shut in the Dammam #7, I think it was in 1982, in Saudi. The #7 was the first successful commercial well in Saudi, drilled in 1938 and produced pretty much continuously for 45years. The Dammam field was shut in because it only produced about 30,000 barrels per day, and with a crude glut, the old GOSP and related facilities needed more capital improvement than the marginal production would justify!
]]> Wed, 29 Jul 2009 14:40:43 -0400
Many old fields that were super giants in their day continue to produce at MUCH lower rates for years after their prime days. I remember when we shut in the Dammam #7, I think it was in 1982, in Saudi. The #7 was the first successful commercial well in Saudi, drilled in 1938 and produced pretty much continuously for 45years. The Dammam field was shut in because it only produced about 30,000 barrels per day, and with a crude glut, the old GOSP and related facilities needed more capital improvement than the marginal production would justify!
]]> http://seekingalpha.com/article/151525-will-the-clean-energy-economy-become-the-next-internet?source=feed#comment-603470 603470 Mon, 27 Jul 2009 10:35:08 -0400 http://seekingalpha.com/article/148676-exxon-ups-the-algae-ante-big-time?source=feed#comment-589083 589083
As a biofuel source, algae has much greater potential than corn or sugarcane on a BTU/acre basis - but it also depends on some rather significant basic science breakthroughs, and some major "developemental" hurdles. Exxon Mobil certainly has an outstanding ability to fund such fundamental research. In today's world, any commercial attempt would probably be spun off to a contained business unit of the company that could be severed, or operated rather autonomously. But any way you slice it - biofuels has very little potential to make a major dent in our future energy needs - the numbers just aren't there. As such, I think this is as much for publicity as it is to produce energy from alternative sources.]]> Wed, 15 Jul 2009 11:18:59 -0400
As a biofuel source, algae has much greater potential than corn or sugarcane on a BTU/acre basis - but it also depends on some rather significant basic science breakthroughs, and some major "developemental" hurdles. Exxon Mobil certainly has an outstanding ability to fund such fundamental research. In today's world, any commercial attempt would probably be spun off to a contained business unit of the company that could be severed, or operated rather autonomously. But any way you slice it - biofuels has very little potential to make a major dent in our future energy needs - the numbers just aren't there. As such, I think this is as much for publicity as it is to produce energy from alternative sources.]]> http://seekingalpha.com/article/148945-laying-the-foundations-for-a-post-oil-age-economy?source=feed#comment-589050 589050 Wed, 15 Jul 2009 11:06:06 -0400 http://seekingalpha.com/article/142922-rising-oil-prices-what-we-have-to-do-asap?source=feed#comment-544058 544058
If Oil at $147/bbl was "too high," then it seems that Oil at $30/bbl was perhaps "too low." As with most things, when a stable trajectory is disturbed, there is an overshoot/hunting response to the disturbance, with a new stable "steady state" being the result. The new stable basis gets priced into the economy. Oversimplified, but basically how dynamic systems respond to impulses. Now, for your recommendations:

Beg OPEC - What? This is a real winner! Beg for what? Stability? Low Prices? High Prices? Alternative Energy Technologies? The only common ground here that makes any sense is "Stability" - OPEC wants it (or at least Ali Naimi/Saudi wants it), but at what level? $70-$80 is the stated happy equilibrium.

Use the SPR - This option makes a little sense when the price is at extreme levels (produce from when price swings too high, add too when price is too low), but not when the price is seeking some intermediate ground. the SPR is NOT a permanent, limitless supply.

Expand Transit system service IMMEDIATELY? How? the problem in most cases is that people don't use it! With gasoline/petrol at relatively low prices, this won't get people on the tube.

Expand Bus service? see above. Have you been to a bus station lately? Unless you are a police officer I doubt it! There is no quick way to make this ANY more attractive (less unattractive?) than it is.

Increase Gas Tax? I thought you said the price was TOO HIGH! Good move, let's MAKE IT HIGHER!

Encourage some sort of "commute efficient" practice by employers - this was done to VERY limited effect back in the '70's energy crunch, and it can have some impact, but not permanent, and I don't understand what "salary subsidy" for the workers results in any incentive for the EMPLOYER to change work days?

"Should have been preparing for this" - well, can't fault you there. I said this THIRTY years ago. All that's changed is the clowns in charge, the circus is the same.
]]> Fri, 12 Jun 2009 12:32:10 -0400
If Oil at $147/bbl was "too high," then it seems that Oil at $30/bbl was perhaps "too low." As with most things, when a stable trajectory is disturbed, there is an overshoot/hunting response to the disturbance, with a new stable "steady state" being the result. The new stable basis gets priced into the economy. Oversimplified, but basically how dynamic systems respond to impulses. Now, for your recommendations:

Beg OPEC - What? This is a real winner! Beg for what? Stability? Low Prices? High Prices? Alternative Energy Technologies? The only common ground here that makes any sense is "Stability" - OPEC wants it (or at least Ali Naimi/Saudi wants it), but at what level? $70-$80 is the stated happy equilibrium.

Use the SPR - This option makes a little sense when the price is at extreme levels (produce from when price swings too high, add too when price is too low), but not when the price is seeking some intermediate ground. the SPR is NOT a permanent, limitless supply.

Expand Transit system service IMMEDIATELY? How? the problem in most cases is that people don't use it! With gasoline/petrol at relatively low prices, this won't get people on the tube.

Expand Bus service? see above. Have you been to a bus station lately? Unless you are a police officer I doubt it! There is no quick way to make this ANY more attractive (less unattractive?) than it is.

Increase Gas Tax? I thought you said the price was TOO HIGH! Good move, let's MAKE IT HIGHER!

Encourage some sort of "commute efficient" practice by employers - this was done to VERY limited effect back in the '70's energy crunch, and it can have some impact, but not permanent, and I don't understand what "salary subsidy" for the workers results in any incentive for the EMPLOYER to change work days?

"Should have been preparing for this" - well, can't fault you there. I said this THIRTY years ago. All that's changed is the clowns in charge, the circus is the same.
]]> http://seekingalpha.com/article/142532-u-s-policies-especially-energy-should-be-much-more-strategic?source=feed#comment-543357 543357
Jimbo - doublegun answered you question quite well - I don't trust government to allocate funds efficiently. Never have and never will. When it comes to "incentives" I prefer some form of tax credit or special deduction which prevents the funds from flowing through the politician's sticky fingers. I also firmly believe that "incentives" should be a catalyst that facilitates some initial resistance then goes away. If the economics are terminally bad - then as my daughter would say - DOHHH let's not do it! If the economics WILL be there once the inertia is overcome to get things rolling, then MAYBE an incentive is a good idea. Many have seemed to confuse incentive and subsidy (or as we used to say a HANDOUT). ]]> Thu, 11 Jun 2009 23:50:27 -0400
Jimbo - doublegun answered you question quite well - I don't trust government to allocate funds efficiently. Never have and never will. When it comes to "incentives" I prefer some form of tax credit or special deduction which prevents the funds from flowing through the politician's sticky fingers. I also firmly believe that "incentives" should be a catalyst that facilitates some initial resistance then goes away. If the economics are terminally bad - then as my daughter would say - DOHHH let's not do it! If the economics WILL be there once the inertia is overcome to get things rolling, then MAYBE an incentive is a good idea. Many have seemed to confuse incentive and subsidy (or as we used to say a HANDOUT). ]]> http://seekingalpha.com/article/142532-u-s-policies-especially-energy-should-be-much-more-strategic?source=feed#comment-541833 541833 Thu, 11 Jun 2009 08:41:51 -0400 http://seekingalpha.com/article/140926-traffic-congestion-who-deserves-to-get-50k?source=feed#comment-529084 529084 Tue, 02 Jun 2009 20:55:11 -0400 http://seekingalpha.com/article/133506-peak-oil-as-a-function-of-earth-s-volume?source=feed#comment-480563 480563 Tue, 28 Apr 2009 09:15:18 -0400 http://seekingalpha.com/article/131496-saudi-khurais-field-looks-like-easy-oil-may-be-gone-from-arabia-too?source=feed#comment-467184 467184
The Yanbu line then was used to feed crude to Riyadh by way of the goverment's pipelines that previously carried Khurais production, and Khurais was "mothballed" for future development. It is only relatively recently that Khurais was properly delineated, and full field development undertaken. As I understand it, the formation oil pay is not as thick nor uniform as originally thought based on extrapolation from Ghawar. Ghawar has been on seawater injection for at least the last 25 years - my memory is a little hazy that far back - it is just the nature of those giant fields, you want to use water injection for pressure maintenance to maximize ultimate recovery - producing without such a mechanism with the the light oil in place would damage the reservoirs early on.

Long story short - I don't think Saudi would be developing Khurais unless it needed incremental capacity to maintain max output in the 10 to 12 million barrel range. Ghawar has been extended by horizontal drilling and improved control. Khurais is by all means a giant oil field, but not as rich as earlier thought to be.

Regards, HC]]> Fri, 17 Apr 2009 18:45:46 -0400
The Yanbu line then was used to feed crude to Riyadh by way of the goverment's pipelines that previously carried Khurais production, and Khurais was "mothballed" for future development. It is only relatively recently that Khurais was properly delineated, and full field development undertaken. As I understand it, the formation oil pay is not as thick nor uniform as originally thought based on extrapolation from Ghawar. Ghawar has been on seawater injection for at least the last 25 years - my memory is a little hazy that far back - it is just the nature of those giant fields, you want to use water injection for pressure maintenance to maximize ultimate recovery - producing without such a mechanism with the the light oil in place would damage the reservoirs early on.

Long story short - I don't think Saudi would be developing Khurais unless it needed incremental capacity to maintain max output in the 10 to 12 million barrel range. Ghawar has been extended by horizontal drilling and improved control. Khurais is by all means a giant oil field, but not as rich as earlier thought to be.

Regards, HC]]> http://seekingalpha.com/article/131407-oil-futures-money-for-the-taking?source=feed#comment-466679 466679
Regards, HC]]> Fri, 17 Apr 2009 11:55:34 -0400
Regards, HC]]> http://seekingalpha.com/article/131407-oil-futures-money-for-the-taking?source=feed#comment-466344 466344
My thoughts as to the WHY behind Andy's very astute observation is that the storage cost is higher than he thinks - We see numerous mentions of crude inventories being at very high levels, which I think is an indication that arbitragiers are indeed at work. So much so, that storage capacity is getting max'ed out. Building new capacity will take too long and be risky in the longer term. The oil producers can keep oil in the ground rather than pruduce it, pay royalties and taxes and then store it. The largest oil storage facilities are in salt domes, mostly owned and operated by the U.S. Govt in the SPR. Other than this capacity, the amount of oil storage capacity as a percentage of production capacity is relatively small. In Saudi Arabia, home to some of the largest crude oil storage tanks in the world - total tankage is only about two or three days worth of production capacity.

Andy, I think the answer is that unused storage to do what you describe just ain't there and the lead time to build more is greater than the market's perception of when the price will snap back.

Regards, HC]]> Fri, 17 Apr 2009 09:09:09 -0400
My thoughts as to the WHY behind Andy's very astute observation is that the storage cost is higher than he thinks - We see numerous mentions of crude inventories being at very high levels, which I think is an indication that arbitragiers are indeed at work. So much so, that storage capacity is getting max'ed out. Building new capacity will take too long and be risky in the longer term. The oil producers can keep oil in the ground rather than pruduce it, pay royalties and taxes and then store it. The largest oil storage facilities are in salt domes, mostly owned and operated by the U.S. Govt in the SPR. Other than this capacity, the amount of oil storage capacity as a percentage of production capacity is relatively small. In Saudi Arabia, home to some of the largest crude oil storage tanks in the world - total tankage is only about two or three days worth of production capacity.

Andy, I think the answer is that unused storage to do what you describe just ain't there and the lead time to build more is greater than the market's perception of when the price will snap back.

Regards, HC]]> http://seekingalpha.com/article/130552-testing-plug-in-hybrids-what-the-results-mean?source=feed#comment-461409 461409 Mon, 13 Apr 2009 09:36:22 -0400 http://seekingalpha.com/article/129097-natural-gas-short-term-bear-long-term-bull?source=feed#comment-449074 449074
I have seen a lot of trucks hauling large diameter epoxy coated line pipe (20+ inch stuff) and a lot of large diameter Cameron Ball Valves (in sets of identical units on trailer rigs) in north Louisiana and North East Texas - so some pipeline construction is underway. My thoughts are that the basic economics and "free market" (such as it is - the ol' invisible hand) will make nat gas rise to the occassion. The trip will be bumpy though, and will be in spite of, rather than because of, anything the current administration does.

Longoil - in principle, there is no reason that nat gas is needed to create hydrogen - in refineries, they crack the long chains to the point that only carbon is left from the hydrogen-carbon molecules - hence petrocoke byproduct. Way back in the old days, in a former era of oil glut - conoco had a major liquid gasification project to produce pipeline quality gas from abundant, cheap crude oil. (this was in the late 60's, early '70's). HOWEVER, it is probably more economical to use natural gas for the hydrogen source than to crack it from the raw bitumen, and produces greatey yields of syncrude.

The huge dip in oil and nat gas prices over the last nine or so months will only make the return to tight supply all the more abrupt and painful...

HC]]> Thu, 02 Apr 2009 09:21:37 -0400
I have seen a lot of trucks hauling large diameter epoxy coated line pipe (20+ inch stuff) and a lot of large diameter Cameron Ball Valves (in sets of identical units on trailer rigs) in north Louisiana and North East Texas - so some pipeline construction is underway. My thoughts are that the basic economics and "free market" (such as it is - the ol' invisible hand) will make nat gas rise to the occassion. The trip will be bumpy though, and will be in spite of, rather than because of, anything the current administration does.

Longoil - in principle, there is no reason that nat gas is needed to create hydrogen - in refineries, they crack the long chains to the point that only carbon is left from the hydrogen-carbon molecules - hence petrocoke byproduct. Way back in the old days, in a former era of oil glut - conoco had a major liquid gasification project to produce pipeline quality gas from abundant, cheap crude oil. (this was in the late 60's, early '70's). HOWEVER, it is probably more economical to use natural gas for the hydrogen source than to crack it from the raw bitumen, and produces greatey yields of syncrude.

The huge dip in oil and nat gas prices over the last nine or so months will only make the return to tight supply all the more abrupt and painful...

HC]]> http://seekingalpha.com/article/122525-nobel-laureate-penzias-u-s-needs-a-1-a-gallon-gas-tax?source=feed#comment-402603 402603
NOBEL PRIZE == BRILLIANT MIND + NO COMMON SENSE]]> Wed, 25 Feb 2009 08:23:20 -0500
NOBEL PRIZE == BRILLIANT MIND + NO COMMON SENSE]]> http://seekingalpha.com/article/121680-your-oil-stocks-aren-t-coming-back?source=feed#comment-396257 396257 Fri, 20 Feb 2009 08:41:57 -0500 http://seekingalpha.com/article/120674-businessweek-exhibits-exxon-apostasy?source=feed#comment-390267 390267 Mon, 16 Feb 2009 08:53:32 -0500 http://seekingalpha.com/article/118774-bill-mandating-25-of-u-s-energy-from-renewables-by-2025-introduced-in-house?source=feed#comment-377519 377519 Thu, 05 Feb 2009 17:07:53 -0500 http://seekingalpha.com/article/116684-obama-shines-natural-gas?source=feed#comment-367839 367839
CH4 + 2O2 --> 2H2O + CO2 and about 1000btu/ cubic foot
C3H8 + 5O2 --> 4H2O + 3CO2 and about 2300btu/ cubic foot

Thus, burning propane produces 2.3 times the energy, but 3.0 times the CO2.... about 30% more CO2 per unit of energy.

I could be wrong, it's hard for an old lawyer to recollect this chem 101 reaction balance stuff.....]]> Tue, 27 Jan 2009 13:41:19 -0500
CH4 + 2O2 --> 2H2O + CO2 and about 1000btu/ cubic foot
C3H8 + 5O2 --> 4H2O + 3CO2 and about 2300btu/ cubic foot

Thus, burning propane produces 2.3 times the energy, but 3.0 times the CO2.... about 30% more CO2 per unit of energy.

I could be wrong, it's hard for an old lawyer to recollect this chem 101 reaction balance stuff.....]]> http://seekingalpha.com/article/116684-obama-shines-natural-gas?source=feed#comment-367345 367345 Tue, 27 Jan 2009 08:18:25 -0500 http://seekingalpha.com/article/110175-gasoline-is-still-losing-near-breakeven?source=feed#comment-325891 325891 Wed, 10 Dec 2008 18:07:33 -0500 http://seekingalpha.com/article/106560-alcohol-can-be-a-gas-debunking-myths-about-ethanol?source=feed#comment-309663 309663
"David Blume, has been going on Coast to Coast AM and promoting the ethanol industry 'doing it right' to an audience of over 10+ million Americans"

Your cred just dropped below the btu value of the fuel being burned in the black helicoptors! Perhaps they can explore using grain from inside crop circles for the manufacture of ethanol, as well as chasing down the scoundrells who bought the water-to-gasoline pills and 200mpg carburetor! LOL]]> Wed, 19 Nov 2008 08:16:52 -0500
"David Blume, has been going on Coast to Coast AM and promoting the ethanol industry 'doing it right' to an audience of over 10+ million Americans"

Your cred just dropped below the btu value of the fuel being burned in the black helicoptors! Perhaps they can explore using grain from inside crop circles for the manufacture of ethanol, as well as chasing down the scoundrells who bought the water-to-gasoline pills and 200mpg carburetor! LOL]]> http://seekingalpha.com/article/103844-goodyear-illustrates-what-oil-companies-might-expect?source=feed#comment-297863 297863 Tue, 04 Nov 2008 08:24:51 -0500 http://seekingalpha.com/article/96685-why-drill-baby-drill-does-not-translate-into-effective-national-energy-policy?source=feed#comment-263118 263118
Carbonate - don't get too worked up. We'll make money off of the 1d1ots (I would just say idiots, but I get some satisfaction from mimicking ol' fearful) along the way! Now, I take exception to your assertion about some foreign countries having lower environmental standards - some have the same high standards, they just don't enforce them! You and I both know that a dozer and gradeall can do wonders with 5 million barrels of oil and a bunch of sand - hell, that is what you call stabilized drift sand.

Alan - there is those of us who understand, and there is them that don't. This whole thread of commentary addresses the rather sophisticated statistical analysis of the author, noting in particular that he knows nothing of the underlying subject matter as evidenced by the complete absense of discussion of natural gas. In that analysis, the author concludes that drilling won't "solve the probleml." Without defining what "the problem" is, I believe that a majority of the commentators have pointed out that drilling is PART of any solution of an ENERGY problem. But hey, what do I know, I'm only a lowly engineer. Who happens to be an attorney. Who has spent a decade or so in the Middle East. I'm sure I'm not as smart as ol' scared ass "Fearing" is. Alan, you live in Houston Tx, thus you are obviously backward. Carbonate, based on your name, you have G&G knowledge, thus probably live in some backward place like Louisiana, Texas, Oklahoma, Colorado, or some other such hell hole. We are all inferior - so let's not argue, we need to just go make $$$$$$$. The other folks? They will be the source of that $$$$$$$!

Laissez Les Bon Temps Roulez!]]> Tue, 23 Sep 2008 23:53:48 -0400
Carbonate - don't get too worked up. We'll make money off of the 1d1ots (I would just say idiots, but I get some satisfaction from mimicking ol' fearful) along the way! Now, I take exception to your assertion about some foreign countries having lower environmental standards - some have the same high standards, they just don't enforce them! You and I both know that a dozer and gradeall can do wonders with 5 million barrels of oil and a bunch of sand - hell, that is what you call stabilized drift sand.

Alan - there is those of us who understand, and there is them that don't. This whole thread of commentary addresses the rather sophisticated statistical analysis of the author, noting in particular that he knows nothing of the underlying subject matter as evidenced by the complete absense of discussion of natural gas. In that analysis, the author concludes that drilling won't "solve the probleml." Without defining what "the problem" is, I believe that a majority of the commentators have pointed out that drilling is PART of any solution of an ENERGY problem. But hey, what do I know, I'm only a lowly engineer. Who happens to be an attorney. Who has spent a decade or so in the Middle East. I'm sure I'm not as smart as ol' scared ass "Fearing" is. Alan, you live in Houston Tx, thus you are obviously backward. Carbonate, based on your name, you have G&G knowledge, thus probably live in some backward place like Louisiana, Texas, Oklahoma, Colorado, or some other such hell hole. We are all inferior - so let's not argue, we need to just go make $$$$$$$. The other folks? They will be the source of that $$$$$$$!

Laissez Les Bon Temps Roulez!]]> http://seekingalpha.com/article/96685-why-drill-baby-drill-does-not-translate-into-effective-national-energy-policy?source=feed#comment-262090 262090
Improved seismic interpretation (which dates back more than 10 years) has permitted discovery and development of relatively small oil reserves. But these are all incremental technologies that improve what has always been done, and the loss of expertise has more than offset the improvement. Horizontal drilling has been more of a paradigm shift in allowing development of the gas shales such as Barnett, Haynesville, Fayetteville, etc.

I personally believe that real technological innovation will come from smaller companies (largely using "retired" expertise from the majors) taking risks, and then the larger producers using M&A to acquire the fruits of their efforts - not unlike the model that larger computer tech leaders have done (Oracle, Microsoft, AMD for example). As we used to say, sometimes it is more economical to acquire reserves with the checkbook than the drillbit, but it is always better to "find" oil.]]> Mon, 22 Sep 2008 23:16:00 -0400
Improved seismic interpretation (which dates back more than 10 years) has permitted discovery and development of relatively small oil reserves. But these are all incremental technologies that improve what has always been done, and the loss of expertise has more than offset the improvement. Horizontal drilling has been more of a paradigm shift in allowing development of the gas shales such as Barnett, Haynesville, Fayetteville, etc.

I personally believe that real technological innovation will come from smaller companies (largely using "retired" expertise from the majors) taking risks, and then the larger producers using M&A to acquire the fruits of their efforts - not unlike the model that larger computer tech leaders have done (Oracle, Microsoft, AMD for example). As we used to say, sometimes it is more economical to acquire reserves with the checkbook than the drillbit, but it is always better to "find" oil.]]>