toobad41

Natural Gas Gains: Not Convinced of Sustainability

I am no longer privy to inside information on natural gas production but I do know that much of the gas we are talking about is old gas...i.e. gas that has been producing to the pipeline for years. For the operator that gas is virtually free. Yes there is some overhead but that is little cost. I suspect that a lot of the drilling going on today is new exploration or lease obligation wells. Lease obligation wells are drilled to save a lease from going to the original owner or to someone else. Some of the drilling may also be aimed at proving up the lateral extent of a new discovery. Sure all of this hearsay on my part but it has been true in the past and I tend to believe it is still going on. Also I would like to point out that most oil or gas operators are not in consort with anyone else and they could care what other operators are drilling unless it is just across the highway from their lease. Sometimes operators will have a relationship with other companies if they have a mutual area of interest. But that rarely happens onshore. It does happen offshore where it costs so much to drill and produce. That is my two cents... For what it is worth.

The Oil Casino: SEC Heading for Monte Carlo, Part III

I thank you Mr. von Altendorf for this excellent presentation. I wished you had brought in to the discussion some of the American companies or minnows that use Monte Carlo simulations in their assessments of reserves. Conflict of interest probably won't allow you to do that. In my experience most companies or minnows use various kinds of modeling scenarios to boost their reserves so they can sell their company or production based what "might" be in the ground. Devon comes to mind. With that said most of us that are or were in the petroleum industry won't live long enough to see the results of our prediction of reserves real or imagined. And in a few years many Reservoir Engineers and Geologists will no longer be in the business or with the company that signed off on their estimates. New people will come on board and do their own estimates. Thus the story repeats itself over and over again.

The Global Oil Scam: 50 Times Bigger than Madoff

Gosh! I can't believe that speculators are manipulating the commodity futures market in oil and trying to make money! Changing the subject...what about oranges...if we have a bad freeze in Florida this year do you think speculators won't jump on that wagon and drive up the price of orange juice? What about a hurricane taking dead aim on Houston, TX? Do you think the price of crude or gasoline for that matter will drop? I don't think so. To change the subject again...who drives the high priced BMW's?...the speculator or the broker. I would place my bet on the broker. True, it appears that GS is trying to manipulate the market to their advantage. It takes big money to make big money in their environment. If they are under the radar, legally, then they will do it. I found this article very interesting and I had no idea this was going on.

The Global Oil Scam: 50 Times Bigger than Madoff

Gosh! I can't believe that speculators are manipulating the commodity futures market in oil and trying to make money! Changing the subject...what about oranges...if we have a bad freeze in Florida this year do you think speculators won't jump on that wagon and drive up the price of orange juice? What about a hurricane taking dead aim on Houston, TX? Do you think the price of crude or gasoline for that matter will drop? I don't think so. To change the subject again...who drives the high priced BMW's?...the speculator or the broker. I would place my bet on the broker. True, it appears that GS is trying to manipulate the market to their advantage. It takes big money to make big money in their environment. If they are under the radar, legally, then they will do it. I found this article very interesting and I had no idea this was going on.

A Crude 10 Year Perspective: The DJIA, Oil and Gold

Very interesting article. Your views parallel mine. Having been in the oil business for over 40 years I have witnessed a lot but nothing like what is happening today. I am curious about what you might think about the next ten years in terms of oil pricing. Based on your prior 10 year increases we should expect oil to be at the very least $400 a barrel in the next 10 years and gold over $5000.

Climate Change: How to Invest for the Possibility

Like oil, natural gas is not found everywhere. And as Ferdinand E mentions it is not as abundant as people think. Most of the natural gas that has every been found is gone. It was vented or burned as a by-product. Even today it is burned or vented to the atmospher because there is no market or pipeline needed for transporting. Even exploration today is aimed at non-conventional resources because conventional sources are depleted. With that said, you can bet your bottom dollar that gas will also become a rare commondity and sooner than you think.

Plenty of Natural Gas: Exploration and Production Companies Keep Increasing Oversupply

Your sentence "The action by E&P Companies as a whole could be short sighted" is a flat out stupid sentence. E&P Companies are independent of each other and seldom (if ever) act as a whole.

Golden Rule: Easy Oil Production Means Cheap Oil, Difficult Production Means Expensive Oil

Well thought out article. People don't realize the cost of finding new oil (or natural for that matter) will be more and more expensive going forward. Like you mentioned, the depth to drill and find oil offshore is another indication of that expense. I would like to mention that the 35,000 foot depth is mostly horizontal drilling. Oil rarely exists below a vertical depth of 10,000 feet and above a bottom hole temperature of 150 degrees F. Below 10,000 feet the rock pressures and temperatures are higher, the oil undergoes a cracking process whereby hydrocarbons convert to natural gas.

Forget About Natural Gas, Oil Field Services Sector Shows More Promise

The current pricing and glut is a result of the intensive search for gas that has been going on for the past several years. The gas plays going on throughout the USA was sparked by good gas pricing. Now that there is an over abundance of the stuff the companies involved with drilling and production will cut back on their activity. Why sell their product at $3.50 today when they can get $12 next quarter or next year?

Is ConocoPhillips Sending Us a Warning about BP?

Watch out for Exxon....They are not cash strapped. My gut feeling is the COP will be history if they continue down the road they are currently on.

Oil Above $50 and Still Has Legs - Cramer

Working Interest Owners of oil production tell me that they have a break-even price of $56 a barrel at the pump. Any price below that is at a loss. So why is oil being produced domestically at a loss? Much of the cash flow was coming in when oil was selling for over $100 a barrel but now that cash flow is ending and the $45 dollar pricing is taken over. The end result is people are losing their jobs, just like any other industry today....to save costs. The current economy is also hurting the oil industry as well. Oil runs civilization. Nothing else comes close. Nothing exists on the horizon to replace oil. Yes the supply is outpacing demand. That is short term contango. It will not last.

Ben Stein Favors Carbon Tax - To Support Big Oil

Ben Stein is not only a joke but an idiot. Celebs are not on my list of people who have anything of value to say.

Six Companies Poised to Gain from a Natural Gas Auto Mandate

Natural gas, like oil, is a limited resource and is difficult to store for future use. Natural gas needs a distribution system in the form of a pipeline (underground) at a cost of over a million dollars a mile. So you need big reserves to justify laying a pipeline. Most of the natural gas is gone (at least in the US), vented or burned to the atmosphere. What companies go afer now is the last of that product. The reason companies go after natural gas is because it is not as regulated as oil, it requires no ugly pump jack, no tubing in the hole and is not subject to spills. Like oil today, gas will have to be imported by container ships. You are right that this is a needed commodity to help with the environment. But it won't be cheap.