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UPDATE 2-U.S. EIA cuts recoverable Monterey shale oil estimate by 96 pct

DA60

DA60

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'May 21 (Reuters) - The U.S. Energy Information Administration (EIA) on Wednesday cut its estimate of recoverable oil in California's Monterey shale by 96 percent, casting doubt on what was once thought to be America's next major energy play.

In what could be welcome news for environmentalists and a potentially bad omen for oil drillers, such as Venoco Inc, with large leases in the region, the EIA slashed its forecast of technically recoverable reserves, citing production difficulties from initial wells.

The reserves were downgraded by 96 percent, from 13.7 billion barrels estimated by a government-funded report in 2011, to just 600 million barrels, the EIA said. A detailed report is expected to be released next month.'

UPDATE 2-U.S. EIA cuts recoverable Monterey shale oil estimate by 96 pct | Reuters
 
I have read many times that U.S. shale oil reserves estimates are often overly - and sometimes wildly - optimistic in terms of practically recoverable oil.
 
Did you trust them when they said they were higher, or do you just trust them now that they say they are lower? Looks like someone got them to say what someone wanted to hear.
 
CalGun said:
Did you trust them when they said they were higher, or do you just trust them now that they say they are lower?
Click to expand...
Don't think it makes a difference. Higher or lower... they were off by 96%!! How can place any trust in something that could be so wrong?
 
The US Shale Oil Miracle Disappears

'U.S. officials cut estimate of recoverable Monterey Shale oil by 96%
May 20, 2014

Federal energy authorities have slashed by 96% the estimated amount of recoverable oil buried in California's vast Monterey Shale deposits, deflating its potential as a national "black gold mine" of petroleum.

Just 600 million barrels of oil can be extracted with existing technology, far below the 13.7 billion barrels once thought recoverable from the jumbled layers of subterranean rock spread across much of Central California, the U.S. Energy Information Administration said.

The new estimate, expected to be released publicly next month, is a blow to the nation's oil future and to projections that an oil boom would bring as many as 2.8 million new jobs to California and boost tax revenue by $24.6 billion annually.

The 2011 estimate was done by the Virginia engineering firm Intek Inc.

Christopher Dean, senior associate at Intek, said Tuesday that the firm's work "was very broad, giving the federal government its first shot at an estimate of recoverable oil in the Monterey Shale. They got more data over time and refined the estimate."
(Source)'

The US Shale Oil Miracle Disappears | Zero Hedge
 
CalGun said:
Did you trust them when they said they were higher, or do you just trust them now that they say they are lower? Looks like someone got them to say what someone wanted to hear.
Click to expand...

I did not trust them when they said they were higher...neither did others:


'“We have deceived ourselves into thinking that since we have an infinite resource, we don’t need to worry,” Tad Patzek, chair of the Petroleum and Geosystems Engineering Department at the University of Texas at Austin, told Bloomberg recently. “We are stumbling like blind people into a future which is not as pretty as we think.”

Alarm bells have in fact been ringing for some time now and in all the places you might expect to hear them.

“Instead of having a 100-year supply of natural gas, a large portion of this coming from shale, the U.S. is likely going to be faced with a deliverability crisis over the next few years,” warned Bill Powers, independent analyst and author of Cold Hungry and In the Dark, in comments made to BNN commodities guru Andrew Bell nearly three months ago. “Demand is continuing to rise and supplies are flattening and may start to decline in 2014.”

“Many of [the U.S. government] projections [for growing shale gas production] are not based on any empirical fact whatsoever,” said Powers.'

Energy Watch: Will the shale gas revolution be short-lived? - BNN News



U.S. Shale-Oil Boom May Not Last as Fracking Wells Lack Staying Power

http://www.businessweek.com/article...not-last-as-fracking-wells-lack-staying-power



From Jim Rogers:

'Wednesday, June 26, 2013

US Natural gas, oil shale overhyped
Regarding natural gas, the fundamentals on the ground are not nearly as good as the hype. The number of rigs on the ground has gone down 75% the last couple of years, as the wells are very short-lived, and it takes an enormous amount of money to keep them up. A number of companies have had to lower estimates of their reserves.

As for oil shale, typical wells deplete at 38 per cent the first year. Thus you need a lot of drilling, money, and a high price to keep up production rates. All you have to do is go out in the oil patch. I believe the investment world will be disappointed with the notion that supply is so great that oil will collapse.'

http://www.jimrogers.info/2013/06/us-natural-gas-oil-shale-overhyped.html
 
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Taylor said:
Don't think it makes a difference. Higher or lower... they were off by 96%!! How can place any trust in something that could be so wrong?
Click to expand...

I don't believe a word they say, either the oil industry or the government that "regulates" it.
 
So they are good estimates now that they fit your agenda, but when they didn't fit your agenda they were bad estimates? Is that safe to say based on what you just wrote here?


DA60 said:
I did not trust them when they said they were higher...neither did others:


'“We have deceived ourselves into thinking that since we have an infinite resource, we don’t need to worry,” Tad Patzek, chair of the Petroleum and Geosystems Engineering Department at the University of Texas at Austin, told Bloomberg recently. “We are stumbling like blind people into a future which is not as pretty as we think.”

Alarm bells have in fact been ringing for some time now and in all the places you might expect to hear them.

“Instead of having a 100-year supply of natural gas, a large portion of this coming from shale, the U.S. is likely going to be faced with a deliverability crisis over the next few years,” warned Bill Powers, independent analyst and author of Cold Hungry and In the Dark, in comments made to BNN commodities guru Andrew Bell nearly three months ago. “Demand is continuing to rise and supplies are flattening and may start to decline in 2014.”

“Many of [the U.S. government] projections [for growing shale gas production] are not based on any empirical fact whatsoever,” said Powers.'

Energy Watch: Will the shale gas revolution be short-lived? - BNN News



U.S. Shale-Oil Boom May Not Last as Fracking Wells Lack Staying Power

U.S. Shale-Oil Boom May Not Last as Fracking Wells Lack Staying Power - Businessweek



From Jim Rogers:

'Wednesday, June 26, 2013

US Natural gas, oil shale overhyped
Regarding natural gas, the fundamentals on the ground are not nearly as good as the hype. The number of rigs on the ground has gone down 75% the last couple of years, as the wells are very short-lived, and it takes an enormous amount of money to keep them up. A number of companies have had to lower estimates of their reserves.

As for oil shale, typical wells deplete at 38 per cent the first year. Thus you need a lot of drilling, money, and a high price to keep up production rates. All you have to do is go out in the oil patch. I believe the investment world will be disappointed with the notion that supply is so great that oil will collapse.'

Jim Rogers: US Natural gas, oil shale overhyped
Click to expand...
 
OK, so recoverable oil is not in California. Frack California..... See what I did here? LOL.
 
either we figure out a new energy model, or our kids are going to have to. and it might get even uglier than that.

i see no good reason not to, other than i like my car and motorcycle. has to be done, though.
 
Helix said:
either we figure out a new energy model, or our kids are going to have to. and it might get even uglier than that.

i see no good reason not to, other than i like my car and motorcycle. has to be done, though.
Click to expand...

Nuclear power is the mathematically obvious answer. Sadly, there is substantial bi-partisan resistance to it based on wildly inflated fears.
 
Deuce said:
Nuclear power is the mathematically obvious answer. Sadly, there is substantial bi-partisan resistance to it based on wildly inflated fears.
Click to expand...

i'm in favor of it, especially thorium, if that tech pans out.
 
Deuce said:
Nuclear power is the mathematically obvious answer. Sadly, there is substantial bi-partisan resistance to it based on wildly inflated fears.
Click to expand...
Was The Fukushima Disaster just a bi-partisan plot to convince the nation of the dangers of nuclear power?

Anyway, I'd be in favor of investing more heavily in Solar and Wind. I'm not ruling out Nuclear power either, but I don't think this country has the maturity to handle the long term perspective required with Nuclear Power.
 
Henry David said:
I don't believe a word they say, either the oil industry or the government that "regulates" it.
Click to expand...

It's all about what's in it for who?

The oil companies have zero to gain by pressuring the EIA to over-estimate the size of the reserve.

On the other hand, politicos within the government have everything to gain.

It's simple deduction.
 
CalGun said:
So they are good estimates now that they fit your agenda, but when they didn't fit your agenda they were bad estimates? Is that safe to say based on what you just wrote here?
Click to expand...

1) No, I said nothing about this estimate.

I said that I did not (and do not) believe that the original shale oil estimates were true - that they were VERY optimistic (based on what people I have some respect for said).

As for how optimistic?

I have no idea.


And 2) What do you care what I 'think' about this? I certainly don't much care what you think about this.
Neither of us wrote the estimates or (I assume) are experts at this - so who cares what either of us 'thinks' about them?
 
apdst said:
It's all about what's in it for who?

The oil companies have zero to gain by pressuring the EIA to over-estimate the size of the reserve.

On the other hand, politicos within the government have everything to gain.

It's simple deduction.
Click to expand...

Oil companies have no reason to pump up the figures?

Are you serious?

The more oil they say is down there, the less worried people get about developing alternatives and the more money/grants they can extract from the government to get the oil.

It is in BOTH the oil companies AND the gov't's interest to provide 'good' numbers.
 
apdst said:
But, you oppose pipelines? That doesn't make any sense.
Click to expand...

no. i don't oppose pipelines, but i support a public / private moonshot to replace oil completely within thirty years or so.
 
That is do able but I wouldn't shoot for completely as much as I would for say 90%.

Simply remove taxation from clean, renewable and eliminate silly regulations and watch capitalism make it happen.


Helix said:
no. i don't oppose pipelines, but i support a public / private moonshot to replace oil completely within thirty years or so.
Click to expand...
 
DA60 said:
Oil companies have no reason to pump up the figures?

Are you serious?

The more oil they say is down there, the less worried people get about developing alternatives and the more money/grants they can extract from the government to get the oil.

It is in BOTH the oil companies AND the gov't's interest to provide 'good' numbers.
Click to expand...

Oil companies don't get grants to explore for oil!
 
apdst said:
Oil companies don't get grants to explore for oil!
Click to expand...
They get investment monies in advance of drilling, if news comes out of a major find, investment (stock prices) increase. It is very much in there interest to say "there is oil there".
 
apdst said:
Oil companies don't get grants to explore for oil!
Click to expand...

Where did I say they get money from the government to drill for oil?

Answer...I didn't.

They do get billions in 'subsidies' though:

'Currently, the U.S. government provides $4 billion in subsidies every year to the major oil producers.'

Obama plan to end U.S. oil subsidies rejected - Business - CBC News

and

Fossil Fuel Subsidies in the U.S. | Oil Change International


You don't agree? Take it up with the sources.


Good day.
 
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Gimmesometruth said:
They get investment monies in advance of drilling, if news comes out of a major find, investment (stock prices) increase. It is very much in there interest to say "there is oil there".
Click to expand...

I agree.
 
Gimmesometruth said:
They get investment monies in advance of drilling, if news comes out of a major find, investment (stock prices) increase. It is very much in there interest to say "there is oil there".
Click to expand...

Oil companies do not get cash money from the government!

It does no good to lie about how big a resevoir is, because if it doesn't produce, the invested money is lost.
 
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