Fracking has been enormously controversial , Gasland, Gasland 2, The truth about
Gasland, Anthropogenic earthquakes....
But I've argued Fracking is economic folly and likely to fail soon
http://www.examiner.com/...
Stung with high costs and mired in more than $20 billion in debt on its U.S. shale operations, the company continues to sell off billions in its assets base as it struggles to right itself. Its actions follow a developing trend of cutbacks, spin- offs, divestures and write downs for oil and gas majors operating in U.S. shale formations. In the last 10 days, British Petroleum, Chevron, ExxonMobil and Royal Dutch Shell have all announced they will be spending less on oil and gas exploration
well maybe it's happeing
These new directions by the oil and gas majors are acknowledgements their energy returns on energy investments are becoming increasingly difficult and hampering their profits despite the initial high expectations for U.S. shale formations over the last several years.
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New Shell Oil CEO Ben Van Beurden recently told shareholders it was bad policy to spend an estimated $80 billion in capital on its North American portfolio and still lose money. Chevron has been cutting back on its level of drilling in the Pennsylvania Marcellus Shale while lowering its 2014 annual corporate production forecast by 6.1%.
,,,
So the Big Guys are figuring out that this just isn't happening..
what's worse is the suckers are figuring it out too.
Investment banker Brooks is also raising the question as to where the oil and gas industry will continue to find the risk capital for exploratory drilling as the majors pull back on their spending. In the U.S. shale oil and gas formations, Brooks stated, “Onshore, for the past few years, a chunk of that capital has been supplied by private equity investors [ ed note: Muppets] who have supported exploration and production teams in start-up ventures. Unfortunately, the results of the shale revolution have been disappointing, leading to significant asset impairment charges and negative cash flows,” He further asks, “Will that capital continue to be available, or will it, too, begin demanding profits
The
Muppets are getting tired of having their faces ripped off.
now why is this?
If a fracked gas play was a good way to make money, investors would be all over it,
just like tobacco or slavery, or investing into the nazis...
So why isn't gas a good investment?
http://www.slate.com/...
After mathematically modeling the actual production of thousands of wells in the Barnett, Fayetteville, and Haynesville Shales, Berman found that operators had significantly exaggerated their claims. Reserves appear to be overstated by more than 100 percent
Typically, the core 10 to 15 percent of a shale formation’s gas is commercially viable. The rest may or may not be—we don’t know at this point. Yet the industry has calculated the potentially recoverable gas as if 100 percent of the plays were equally productive.
The claimed lifetime productivity, or estimated ultimate recovery, of individual wells was also overstated, Berman found. The production decline curves modeled by well operators predict that production will fall steeply at first, followed by a long, flattened tail of production. Berman's analysis found a better fit with a model in which production falls steeply for the first 10 to 15 months, followed by an more weakly hyperbolic decline. Shale-gas wells typically pay out over one-half their total lifetime production in the first year. So operators must keep drilling continuously to maintain a flat rate of overall production.
i'd read the article or
http://petroleumtruthreport.blogspot.com/
but What's interesting to me is this
at stake are a number of high profile U.S. politicians who have staked, to a large degree, their upcoming reelection by campaigning on the claimed successes of the oil and gas companies operating within their state’s shale formation. One such politician seeking reelection this year is Pennsylvania’s Governor Tom Corbett who has been heavily touting what several leading Pennsylvanian labor economists believe are questionable job creation numbers in the state’s Marcellus Shale formation. Corbett has also offered Shell Oil more than $1.6 billion in state tax credits t
now some people will say it's all due to the hippies and some will say
it's due to gas prices falling due to success
but
While many cite the low price for U.S. natural gas as the main reason for the dismal financial performances of the oil and gas majors, natural gas prices have risen from an industry low of $1.72 per million BTU of gas in early 2012 to the $4.00 to $5.00 plus MBTU range over the last several months. Yesterday natural gas futures closed at $4.51 per MBTU.
No, it's what i think they call
http://cps-static.rovicorp.com/...