RE: Natural gas: The fracking fallacy

['Chris de Morsella' via Everything List]

 

 

From: everything-list@googlegroups.com 
[mailto:everything-list@googlegroups.com] On Behalf Of John Clark
Sent: Saturday, January 03, 2015 9:13 PM
To: everything-list@googlegroups.com
Subject: Re: Natural gas: The fracking fallacy

 

 

 

On Sat, Jan 3, 2015 at 8:31 PM, meekerdb  wrote:

>> If that is the correct way to calculate EROI, and assuming you think the 
>> first law of thermodynamics is valid please explain how the  EROI of 
>> ANYTHING is EVER greater than 1. Perhaps I shouldn't have made that 
>> assumption, do you believe the law of conservation of energy is wrong, 
>> Wikipedia says it's correct but you say they don't know anything. 

> The difference is that if you treat kerogen as a primary energy source it 
> takes energy to get it, unlike sunlight.  

 

To convert kerogen to crude oil you must first start to heat it with outside 
energy and you have to pay for that energy and so it must be included in 
calculating EROEI. However that initial heat causes chemical changes in the 
kerogen that also releases a substantial amount of heat, and that heat came 
from the chemical self-energy of the kerogen itself, and that energy you did 
NOT pay for and so it would be ridiculous to include it in calculating EROEI.

What magical exothermic chemical reaction are you speaking of? You cook the 
shale rock bearing kerogen and by doing so you chemically change some of the 
hydrocarbon resource into an oil and also release some gas volatiles. You can 
decide to use some of this cooked out potential energy and BURN it in the 
presence of oxygen (so you first need to get it out of the shale rock matrix 
before you can burn it because burning --e.g. oxidation -- requires oxygen)

There is no magic in situ exothermic chemical reaction going on. A portion of 
the extracted and produced usable energy product can be removed from the net 
yield to be re-invested back into the process in order to keep it sustaining. 
But that invested energy could just as well come from another source of heat as 
well and the valuable liquid hydrocarbon could be sold on the market.

That is a financial business decision and does not alter the fact that the 
extraction process requires considerable Energy investments. It does not change 
the EROI. Calling it “self-energy” is obfuscation; it is energy that has been 
extracted and is being re-invested in order to maintain the extraction process.

-Chris

That is why Wikipedia says:


"A 1984 study estimated the EROEI of the various known oil-shale deposits as 
varying between 0.7–13.3. More recent studies estimates the EROEI of oil shales 
to be 2:1 or 16:1  depending on whether self-energy is counted as a cost or 
internal energy is excluded and only purchased energy is counted as input."

  John K Clark


 

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RE: Natural gas: The fracking fallacy

['Chris de Morsella' via Everything List]

 

 

From: everything-list@googlegroups.com 
[mailto:everything-list@googlegroups.com] On Behalf Of John Clark
Sent: Saturday, January 03, 2015 8:42 PM
To: everything-list@googlegroups.com
Subject: Re: Natural gas: The fracking fallacy

 

On Sat, Jan 3, 2015 at 9:46 PM, 'Chris de Morsella' via Everything List 
 wrote:

 

> And the thought still cracks me up with laughter… imagine how wrong your 
> carefully laid plans could go…. You set up this one way ticket to eternity… 
> then, unfortunately you do not die, but instead grow into a vegetative 
> Alzheimer riddled sponge of your former pompous loud mouthed self…. And only 
> then after your brain has fully and completely rotted into a plaque ridden 
> mush does nature finally do the kindness of killing you off – to preserve 
> your Alzheimer destroyed brain for all time. It actually cracks me up dude… 
> nothing personal, I frankly don’t give a rats ass what happens to your 
> precious brain, just find the thought of your so carefully laid plans going 
> so totally haywire to be a source of some laughter for me

 

You sir are a psychopath.

You can dish it out, but you can’t take it? How pathetic, petulant & childish. 

As well as being a vituperative loudmouth A-hole Mr. Clark 

FYI: I also don’t give a rat’s ass what you think I am. 

You have cheese for brains sir and you have shown this, in living color, by 
making repeated asinine assertions about the meaning of EROI, which you quite 
obviously do not understand in the slightest. I have patiently tried to educate 
you, but you prefer the act of being a loud mouth moron… 

Mr. Clark, the caped defender of kerogen…  riding in, to do battle like some 
later day Don Quixote. With you as a champion the kerogen sector is in good 
hands and we can all rest assured that it will keep on producing the big 
nothing at all that it has always produced and that it will continue to be a 
voracious money pit for those who try. $10 billion lost by the DOE; $5 billion 
burned away by Exxon/Mobile.

John, if I have offended you… truth be told, I don’t much care; so by all means 
A-hole, please remain offended, mortified and self-absorbed with outrage. You 
brought this on yourself by being arrogant, rude, obnoxious and worst of all 
stupid. Really, really stupid in fact; surprisingly stupid. 

That you continue to so completely miss the meaning of EROI and insist it 
measures something it does not – at first one can put this down to ignorance, 
but by the third or fourth time John, it just becomes stupid. Truly you 
disappoint me, I mean I already knew you were an abrasive asshole John, but I 
thought at least you had some intelligence. Your EROI kerogen performance has 
convinced me otherwise, I am sad to say.

Suit up, super hero…  John K Clark, the Defender of Kerogen… put your tar 
colored cape on and ride off into the sunset, keeping the world safe for the 
(in reality) non-existent kerogen shale sector. 

-Chris

 

  John K Clark

 

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Re: Natural gas: The fracking fallacy

[John Clark]

On Sat, Jan 3, 2015 at 8:26 PM,  wrote:

> jeez...you two are ripping eachother's balls off verbally. How did things
> get to this? Not I to caste stones in glass houses mind you. Then
> againI never / have never called anyone names like you two to
> oneanother here.
>

Yeah sorry about that, I know it got a bit ugly, but it's over now.  I
began to suspect a few days ago that Chris de Morsella might not be
entirely sane but only today did I realize that he's not just crazy he's
scary crazy.

 John K Clark




>
>

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Re: Natural gas: The fracking fallacy

[John Clark]

On Sat, Jan 3, 2015 at 8:31 PM, meekerdb  wrote:
>
> >> If that is the correct way to calculate EROI, and assuming you think
> the first law of thermodynamics is valid please explain how the  EROI of
> ANYTHING is EVER greater than 1. Perhaps I shouldn't have made that
> assumption, do you believe the law of conservation of energy is wrong,
> Wikipedia says it's correct but you say they don't know anything.
>
>  > The difference is that if you treat kerogen as a primary energy source
> it takes energy to get it, unlike sunlight.
>

To convert kerogen to crude oil you must first start to heat it with
outside energy and you have to pay for that energy and so it must be
included in calculating EROEI. However that initial heat causes chemical
changes in the kerogen that also releases a substantial amount of heat, and
that heat came from the chemical self-energy of the kerogen itself, and
that energy you did NOT pay for and so it would be ridiculous to include it
in calculating EROEI.

That is why Wikipedia says:

"A 1984 study estimated the EROEI of the various known oil-shale deposits
as varying between 0.7–13.3. More recent studies estimates the EROEI of oil
shales to be 2:1 or 16:1  *depending on whether self-energy is counted as a
cost or internal energy is excluded and only purchased energy is counted as
input."*

  John K Clark

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Re: Natural gas: The fracking fallacy

[John Clark]

On Sat, Jan 3, 2015 at 9:46 PM, 'Chris de Morsella' via Everything List <
everything-list@googlegroups.com> wrote:

> And the thought still cracks me up with laughter… imagine how wrong your
> carefully laid plans could go…. You set up this one way ticket to eternity…
> then, unfortunately you do not die, but instead grow into a vegetative
> Alzheimer riddled sponge of your former pompous loud mouthed self…. And
> only then after your brain has fully and completely rotted into a plaque
> ridden mush does nature finally do the kindness of killing you off – to
> preserve your Alzheimer destroyed brain for all time. It actually cracks me
> up dude… nothing personal, I frankly don’t give a rats ass what happens to
> your precious brain, just find the thought of your so carefully laid plans
> going so totally haywire to be a source of some laughter for me


You sir are a psychopath.

  John K Clark

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RE: Natural gas: The fracking fallacy

['Chris de Morsella' via Everything List]

 

 

From: everything-list@googlegroups.com 
[mailto:everything-list@googlegroups.com] On Behalf Of meekerdb
Sent: Saturday, January 03, 2015 5:31 PM
To: everything-list@googlegroups.com
Subject: Re: Natural gas: The fracking fallacy

 

On 1/3/2015 1:29 PM, John Clark wrote:

 

 

On Fri, Jan 2, 2015 at 10:23 PM, 'Chris de Morsella' via Everything List 
 wrote

 I thought Wikipedia was consistently wrong about everything and only used by 
shallow people like me. 

 

>I go to Wikipedia quite a bit myself but

 

Oh yes, I knew there would be a "but".

> when big money depends on some numbers looking good

 

Or when Wikipedia is not in sync with your scientific ignorance and says 
something that you wish were not true. Apparently you believe that if you wish 
hard enough that something is not true it isn't. 

 > Wikipedia is open to corruption

 

But only when Wikipedia says something that you wish were not true. We 
shouldn't trust Wikipedia but we should trust Chris de Morsella even when he 
has absolutely nothing to back up his claims.

 

>You were wrong in trying to maintain that because the efficiency of a solar 
>cell is around 20% then the 80% of incident solar energy that the cell was not 
>able to capture must therefore be counted as ENERGY INVESTED.

 

OF COURSE IT'S WRONG YOU BRAINLESS TWIT, only a fool would count light that you 
didn't pay for as energy invested, but you are a fool and so you do count the 
self-energy of the kerogen,  energy that you didn't pay for, as energy invested 
when figuring out the EROI to convert kerogen to oil.  So  why the 
inconsistency, why not use the same imbecilic method for solar cells that you 
use for kerogen? Could it possibly be because you like solar cells but don't 
like kerogen? Nah, I'm sure that was just a coincidence. 

> The process of producing oil (+gas) from shale rock containing kerogen 
> requires huge energy inputs in order to cook all of that rock!

 

Yes and a large part of that energy comes from the chemical energy of the 
kerogen itself that is released as heat. Of course that means that the chemical 
energy in a pound of kerogen is greater than the chemical energy in the crude 
oil that the pound of kerogen produced, and a pound of crude oil has more 
chemical energy than the refined  gasoline that came from that pound of crude 
oil, but given that  the law of conservation of energy is what it is a educated 
person, a smart person, and a honest person wouldn't expect anything else. 

 

> EROI is ONLY measuring the ratio of the *measurable energy* inputs required 
> to produce the energy yield

 

Like the *measurable* amount of solar energy falling on a solar cell. 

 

>to the *energy value* contained in the resultant yielded product.

If that is the correct way to calculate EROI, and assuming you think the first 
law of thermodynamics is valid please explain how the  EROI of ANYTHING is EVER 
greater than 1. Perhaps I shouldn't have made that assumption, do you believe 
the law of conservation of energy is wrong, Wikipedia says it's correct but you 
say they don't know anything. 


The difference is that if you treat kerogen as a primary energy source it takes 
energy to get it, unlike sunlight.  So if it takes two units of kerogen to 
produce enough energy to get one unit of kerogen you can't sustain extraction 
of kerogen.  You can keep extracting it using some other source of oil or 
nuclear power or photovoltaics, but you can't do it just using kerogen.  So my 
understanding of EROI is
EROI = (Usable energy out)/(Total energy used to produce it)

It doesn't matter to the EROI where the denominator comes from, but it matters 
in the sustainability of the source as primary energy.  One may well choose to 
expend more energy than you get out because the form of energy out makes it 
more suitable - that's why we extract avgas from crude, but you can't do that 
as a primary energy source.

 

Agreed – and much earlier on in this interminable argument with Mr. Clark I 
mentioned this very consideration with regards to producing oil from kerogen – 
that because liquid fuels have such an energy premium – above beyond just the 
raw chemical energy potential they contain – because they are a highly 
concentrated and portable store of energy. This becomes an  especially 
important consideration in the transportation sector.

Because of this it sometimes may make economic sense to invest more energy into 
some potential resource than can be produced from the resulting yield because 
the quality of the yielded energy may be significantly more valuable than the 
quality of the energy source invested into producing the output. 

With Kerogen production – it is possible to argue that if the processing heat 
can be provided by a poor resource (coal for example) – then the resulting 
value of the yielded o

RE: Natural gas: The fracking fallacy

['Chris de Morsella' via Everything List]

 

 

From: everything-list@googlegroups.com 
[mailto:everything-list@googlegroups.com] On Behalf Of John Clark

 

 

On Fri, Jan 2, 2015 at 10:23 PM, 'Chris de Morsella' via Everything List 
 wrote

 I thought Wikipedia was consistently wrong about everything and only used by 
shallow people like me. 

You are an emotional child John… get over your pompous self and grow up… you 
are a little old to be acting so infantile.

 

>I go to Wikipedia quite a bit myself but

 

Oh yes, I knew there would be a "but".

> when big money depends on some numbers looking good

 

Or when Wikipedia is not in sync with your scientific ignorance and says 
something that you wish were not true. Apparently you believe that if you wish 
hard enough that something is not true it isn't. 

Apparently you believe anything you read on Wikipedia. It seems patently 
obvious that you lack the intellectual curiosity to do deeper research and fact 
checking when reading controversial subject matter, accepting uncritically what 
is published on a website called Wikipedia that has an open editing and comment 
process that works most of the time but has been demonstrated to be vulnerable 
to concerted efforts by small groups of very interested people. 

That you do not get – and furthermore feel driven to MOCK – this more cautious 
approach and attitude of mine vis a vis any source reputing to provide “facts”, 
“news” or “knowledge” is not something I would loudly trumpet John… think about 
it dude; you attitude is actually rather stupid.

 > Wikipedia is open to corruption

 

But only when Wikipedia says something that you wish were not true. We 
shouldn't trust Wikipedia but we should trust Chris de Morsella even when he 
has absolutely nothing to back up his claims.

 

Wrong John it is better to never blindly trust any single source. Always, 
especially for subjects over which there is much controversy and debate, for 
which the facts may not be as solid and clear as they at first seem… always 
seek other references to corroborate any facts.

That you fail to see any wisdom in this approach is rather more a marker of 
your own intellectual poverty than it is insightful on your part.

 

>You were wrong in trying to maintain that because the efficiency of a solar 
>cell is around 20% then the 80% of incident solar energy that the cell was not 
>able to capture must therefore be counted as ENERGY INVESTED.

 

OF COURSE IT'S WRONG YOU BRAINLESS TWIT, only a fool would count light that you 
didn't pay for as energy invested, but you are a fool and so you do count the 
self-energy of the kerogen,  energy that you didn't pay for, as energy invested 
when figuring out the EROI to convert kerogen to oil.  

Very amusing…. In the very same breath in which you call me a brainless twit in 
bold and all caps you go on to demonstrate your own gross misunderstanding of 
what it is EROI measures. 

First off my arrogant fellow it was you yourself Mr. John K Clark who was 
insisting that the non captured portion of incident solar irradiation should be 
counted as energy invested. It was not I who made that idiotic claim that was 
your own ignorant loud mouth that uttered that rich piece of utter ignorance.

Second, as I have patiently tried to explain to you – in the manner one uses 
with a small slow learning child – uncaptured or un-recovered portions of a 
resource have no effect one way or the other on EROI measurements – they are 
not being INVESTED into the process in order to accomplish the goal. The 
non-captured solar energy is just that – uncaptured energy, just as the remnant 
oil or gas left in a depleted field is also an un-captured resource. 

Can you follow me so far John, or is this too complicated for you?

However if a process requires an energy input in order to function – however or 
wherever that input energy is derived from – that necessary required input 
energy IS ENERGY INVESTED – in terms of how EROI defines ENERGY INVESTED.

It makes no difference whether the operator actually had to purchase the enetgy 
inputs off the market or was able to produce these energy inputs by some other 
means – they are and still remain REQUIRED NECESSARY ENERGY INPUTS 

You are trying to re-define EROI to suit your polemic position; and guess what 
John you do not get to do that. I know it sucks doesn’t it; grow up you four 
year old child.

 

So  why the inconsistency, why not use the same imbecilic method for solar 
cells that you use for kerogen? 

The inconsistency here is in your poor understanding of EROI. 

 

Could it possibly be because you like solar cells but don't like kerogen? Nah, 
I'm sure that was just a coincidence. 

Some facts: The global installed capacity for Solar PV in 2013 has reached 
around 140GW of installed producing capacity. Can you, my dear fellow for 
comparisons sake give me the 2013 global production numbers for kerogen derived 
oil? How many millions of barrels? Or is it actually exceedingly close to ZE

Re: Natural gas: The fracking fallacy

[meekerdb]

On 1/3/2015 1:29 PM, John Clark wrote:



On Fri, Jan 2, 2015 at 10:23 PM, 'Chris de Morsella' via Everything List 
mailto:everything-list@googlegroups.com>> wrote


 I thought Wikipedia was consistently wrong about everything and only 
used by
shallow people like me.

>I go to Wikipedia quite a bit myself but


Oh yes, I knew there would be a "but".

> when big money depends on some numbers looking good


Or when Wikipedia is not in sync with your scientific ignorance and says something that 
you wish were not true. Apparently you believe that if you wish hard enough that 
something is not true it isn't.


 > Wikipedia is open to corruption


But only when Wikipedia says something that you wish were not true. We shouldn't trust 
Wikipedia but we should trust Chris de Morsella even when he has absolutely nothing to 
back up his claims.


>You were wrong in trying to maintain that because the efficiency of a 
solar cell is
around 20% then the 80% of incident solar energy that the cell was not able 
to
capture must therefore be counted as ENERGY INVESTED.


*OF COURSE IT'S WRONG YOU BRAINLESS TWIT*, only a fool would count light that you didn't 
pay for as energy invested, but you are a fool and so you do count the self-energy of 
the kerogen,  energy that you didn't pay for, as energy invested when figuring out the 
EROI to convert kerogen to oil.  So  why the inconsistency, why not use the same 
imbecilic method for solar cells that you use for kerogen? Could it possibly be because 
you like solar cells but don't like kerogen? Nah, I'm sure that was just a coincidence.


> The process of producing oil (+gas) from shale rock containing kerogen 
requires
huge energy inputs in order to cook all of that rock!


Yes and a large part of that energy comes from the chemical energy of the kerogen itself 
that is released as heat. Of course that means that the chemical energy in a pound of 
kerogen is greater than the chemical energy in the crude oil that the pound of kerogen 
produced, and a pound of crude oil has more chemical energy than the refined  gasoline 
that came from that pound of crude oil, but given that  the law of conservation of 
energy is what it is a educated person, a smart person, and a honest person wouldn't 
expect anything else.


> EROI is ONLY measuring the ratio of the *measurable energy* inputs 
required to
produce the energy yield


Like the *measurable* amount of solar energy falling on a solar cell.

>to the *energy value* contained in the resultant yielded product.

If that is the correct way to calculate EROI, and assuming you think the first law of 
thermodynamics is valid please explain how the  EROI of ANYTHING is EVER greater than 1. 
Perhaps I shouldn't have made that assumption, do you believe the law of conservation of 
energy is wrong, Wikipedia says it's correct but you say they don't know anything.


The difference is that if you treat kerogen as a primary energy source it takes energy to 
get it, unlike sunlight.  So if it takes two units of kerogen to produce enough energy to 
get one unit of kerogen you can't sustain extraction of kerogen.  You can keep extracting 
it using some other source of oil or nuclear power or photovoltaics, but you can't do it 
just using kerogen.  So my understanding of EROI is

EROI = (Usable energy out)/(Total energy used to produce it)

It doesn't matter to the EROI where the denominator comes from, but it matters in the 
sustainability of the source as primary energy. One may well choose to expend more energy 
than you get out because the form of energy out makes it more suitable - that's why we 
extract avgas from crude, but you can't do that as a primary energy source.


Brent

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Re: Natural gas: The fracking fallacy

[zibblequibble]

On Saturday, January 3, 2015 9:29:22 PM UTC, John Clark wrote:
>
>
>
> On Fri, Jan 2, 2015 at 10:23 PM, 'Chris de Morsella' via Everything List <
> everyth...@googlegroups.com > wrote
>
>  I thought Wikipedia was consistently wrong about everything and only used 
>>> by shallow people like me. 
>>>
  
>>>
>> >I go to Wikipedia quite a bit myself but
>
>
> Oh yes, I knew there would be a "but".
>
> > when big money depends on some numbers looking good
>>
>
> Or when Wikipedia is not in sync with your scientific ignorance and says 
> something that you wish were not true. Apparently you believe that if you 
> wish hard enough that something is not true it isn't. 
>
>  > Wikipedia is open to corruption
>>
>
> But only when Wikipedia says something that you wish were not true. We 
> shouldn't trust Wikipedia but we should trust Chris de Morsella even when 
> he has absolutely nothing to back up his claims.
>  
>
>> >You were wrong in trying to maintain that because the efficiency of a 
>> solar cell is around 20% then the 80% of incident solar energy that the 
>> cell was not able to capture must therefore be counted as ENERGY INVESTED.
>>
>
> *OF COURSE IT'S WRONG YOU BRAINLESS TWIT*, only a fool would count light 
> that you didn't pay for as energy invested, but you are a fool and so you 
> do count the self-energy of the kerogen,  energy that you didn't pay for, 
> as energy invested when figuring out the EROI to convert kerogen to oil.  
> So  why the inconsistency, why not use the same imbecilic method for solar 
> cells that you use for kerogen? Could it possibly be because you like solar 
> cells but don't like kerogen? Nah, I'm sure that was just a coincidence. 
>
> > The process of producing oil (+gas) from shale rock containing kerogen 
>> requires huge energy inputs in order to cook all of that rock!
>>
>
> Yes and a large part of that energy comes from the chemical energy of the 
> kerogen itself that is released as heat. Of course that means that the 
> chemical energy in a pound of kerogen is greater than the chemical energy 
> in the crude oil that the pound of kerogen produced, and a pound of crude 
> oil has more chemical energy than the refined  gasoline that came from that 
> pound of crude oil, but given that  the law of conservation of energy is 
> what it is a educated person, a smart person, and a honest person wouldn't 
> expect anything else. 
>  
>
>> > EROI is ONLY measuring the ratio of the *measurable energy* inputs 
>> required to produce the energy yield
>>
>
> Like the *measurable* amount of solar energy falling on a solar cell. 
>  
>
>> >to the *energy value* contained in the resultant yielded product.
>>
> If that is the correct way to calculate EROI, and assuming you think the 
> first law of thermodynamics is valid please explain how the  EROI of 
> ANYTHING is EVER greater than 1. Perhaps I shouldn't have made that 
> assumption, do you believe the law of conservation of energy is wrong, 
> Wikipedia says it's correct but you say they don't know anything. 
>  
>
>> >so your yadda yadda about all processes being less than 
>> thermodynamically perfect is mere useless noise
>>
> Yes, just like Wikipedia physics is all yadda yadda because when big 
> money depends on some numbers looking good the first and second laws of 
> thermodynamics are open to corruption. But we can take solace in the fact 
> that Chris de Morsella is absolutely incorruptible. 
>
> > That would really mess up with your plans for eternal preservation. 
>> Imagine that your Alzheimer riddled brain preserved forever…. An amusing 
>> thought for me… so thanks for that little word trigger John.
>>
>
> Hmm, "An amusing thought for me", you really are a charming fellow Chris. 
> You've won the quadruple crown, you are sadistic, you are a scientific 
> illiterate, you are dumb as dog shit, and you are a coward. Other than that 
> you're a fine fellow, but I think I've had about enough of you for now,
>
>  John K Clark
>

jeez...you two are ripping eachother's balls off verbally. How did things 
get to this? Not I to caste stones in glass houses mind you. Then 
againI never / have never called anyone names like you two to 
oneanother here. I don't name-callI just want to be free to express 
my POV true to myself and being-rational and stuff. Which never involves 
calling no one no damn idiot or fool. not like what you do. SoI gots to 
ask you. How do youyou know? nudge nudge wink wink. Know what I 
mean? How do you pull it off without being vilified and ignored by 
everyone? LikeI might want to move into the invectives and swear-word 
orientated slagging off total put down scene. I'd like to move up and into 
a gig like that...but I need a mentor who can show me how that's done 
without getting perm-ignored and hated on/ 

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Re: Natural gas: The fracking fallacy

[John Clark]

On Fri, Jan 2, 2015 at 10:23 PM, 'Chris de Morsella' via Everything List <
everything-list@googlegroups.com> wrote

 I thought Wikipedia was consistently wrong about everything and only used
>> by shallow people like me.
>>
>>>
>>
> >I go to Wikipedia quite a bit myself but


Oh yes, I knew there would be a "but".

> when big money depends on some numbers looking good
>

Or when Wikipedia is not in sync with your scientific ignorance and says
something that you wish were not true. Apparently you believe that if you
wish hard enough that something is not true it isn't.

 > Wikipedia is open to corruption
>

But only when Wikipedia says something that you wish were not true. We
shouldn't trust Wikipedia but we should trust Chris de Morsella even when
he has absolutely nothing to back up his claims.


> >You were wrong in trying to maintain that because the efficiency of a
> solar cell is around 20% then the 80% of incident solar energy that the
> cell was not able to capture must therefore be counted as ENERGY INVESTED.
>

*OF COURSE IT'S WRONG YOU BRAINLESS TWIT*, only a fool would count light
that you didn't pay for as energy invested, but you are a fool and so you
do count the self-energy of the kerogen,  energy that you didn't pay for,
as energy invested when figuring out the EROI to convert kerogen to oil.
So  why the inconsistency, why not use the same imbecilic method for solar
cells that you use for kerogen? Could it possibly be because you like solar
cells but don't like kerogen? Nah, I'm sure that was just a coincidence.

> The process of producing oil (+gas) from shale rock containing kerogen
> requires huge energy inputs in order to cook all of that rock!
>

Yes and a large part of that energy comes from the chemical energy of the
kerogen itself that is released as heat. Of course that means that the
chemical energy in a pound of kerogen is greater than the chemical energy
in the crude oil that the pound of kerogen produced, and a pound of crude
oil has more chemical energy than the refined  gasoline that came from that
pound of crude oil, but given that  the law of conservation of energy is
what it is a educated person, a smart person, and a honest person wouldn't
expect anything else.


> > EROI is ONLY measuring the ratio of the *measurable energy* inputs
> required to produce the energy yield
>

Like the *measurable* amount of solar energy falling on a solar cell.


> >to the *energy value* contained in the resultant yielded product.
>
If that is the correct way to calculate EROI, and assuming you think the
first law of thermodynamics is valid please explain how the  EROI of
ANYTHING is EVER greater than 1. Perhaps I shouldn't have made that
assumption, do you believe the law of conservation of energy is wrong,
Wikipedia says it's correct but you say they don't know anything.


> >so your yadda yadda about all processes being less than
> thermodynamically perfect is mere useless noise
>
Yes, just like Wikipedia physics is all yadda yadda because when big money
depends on some numbers looking good the first and second laws of
thermodynamics are open to corruption. But we can take solace in the fact
that Chris de Morsella is absolutely incorruptible.

> That would really mess up with your plans for eternal preservation.
> Imagine that your Alzheimer riddled brain preserved forever…. An amusing
> thought for me… so thanks for that little word trigger John.
>

Hmm, "An amusing thought for me", you really are a charming fellow Chris.
You've won the quadruple crown, you are sadistic, you are a scientific
illiterate, you are dumb as dog shit, and you are a coward. Other than that
you're a fine fellow, but I think I've had about enough of you for now,

 John K Clark

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RE: Natural gas: The fracking fallacy

['Chris de Morsella' via Everything List]

 

 

From: everything-list@googlegroups.com 
[mailto:everything-list@googlegroups.com] On Behalf Of John Clark
Sent: Friday, January 02, 2015 5:34 PM
To: everything-list@googlegroups.com
Subject: Re: Natural gas: The fracking fallacy

 

 

On Fri, Jan 2, 2015 at 6:01 PM, 'Chris de Morsella' via Everything List 
 wrote:

 

> I give you the definition as it is defined in Wikipedia

 

But I thought Wikipedia was consistently wrong about everything and only used 
by shallow people like me. 

 

I go to Wikipedia quite a bit myself, and over time have come to understand 
that because of the process by which Wiki entries are edited and re-edited that 
for subjects that have HUGE money, religious or political interests tied up in 
them that it pays to take it with a grain of salt. On the other hand for less 
controversial subjects it is a great resource. If I need to look up the mass of 
Jupiter I am sure Wikipedia is as good as any place else.

But when big money depends on some numbers looking good an open source editing 
process such as Wikipedia is open to corruption by concerted small groups of 
people desiring to influence – by editing – and commenting on – a Wiki entry.

For shale oil data I try to as much as possible get the raw data sets, such as 
county (or preferably well) level production numbers. The aggregate numbers 
published by the EIA and the IEA and hyped by the shale boosters are wildly 
optimistic – both in mine and many others opinion. I know and have long 
corresponded with researchers who are delving into the raw data. If you want 
the real picture go find the raw data and graph it.

 

> EROI is the  <http://en.wikipedia.org/wiki/Ratio> ratio of the amount of 
> usable  <http://en.wikipedia.org/wiki/Energy> energy acquired from a 
> particular energy resource to the amount of energy expended to obtain that 
> energy resource.

 

Fine,  you did not have to expend any energy for sunlight to fall on a solar 
cell , 

 

Pleased to see you just admitted you were wrong – and not just wrong in the 
mere sense of transposing a number or getting some fact wrong, but wrong in the 
sense of having erred because of a fundamentally poor grasp of the subject 
matter. 

You were wrong in trying to maintain that because the efficiency of a solar 
cell is around 20% then the 80% of incident solar energy that the cell was not 
able to capture must therefore be counted as ENERGY INVESTED. That is not just 
factually wrong John, it demonstrates a shallow understanding of what EROI is 
measuring versus what it is NOT measuring.

 

and you did not have to expend any energy to obtain the self energy of the 
kerogen to help you convert itself to oil, 

 

Dude wrong again! The energy POTENTIAL contained within the wax like kerogen 
that is itself scattered about in micro-scale deposits in the massive shale 
rock matrix does not somehow magically materialize for FREE without effort. 
Great effort must be expended in order to extract the energy potential of this 
resource. The shale rock itself needs to be cooked for many weeks at 350 
degrees C. In what universe is that free?

The fact that – post facto after the potential energy of a portion of the 
resource has been extracted that a great portion (more than half) must be used, 
e.g. re-invested (note the word invested) back into the processing of 
additional raw resource. This is not free John. A lot of work has gone into 
getting the oil (+gas) cooked out of the rock. To burn the oil to make 
processing heat would be economically insane when one could instead burn much 
less valuable coal (liquid fuels have premium value as an energy store)… that 
oil is NOT free John it has market value. 

The gas produced is a less valuable commodity – as all gas is for that matter 
(often still just burnt off into the air at the wellhead) – because it needs a 
pipeline infrastructure that probably does not exist where the kerogen bearing 
shale resource is located. Because of this it may make ECONOMIC sense to burn 
some or even all of this gas to produce some of the required processing heat, 
but this is still ENERGY that is BEING INVESTED!

 

 

you get it for free. And by the way, did you know that with multicrystalline 
silicon solar cells, the most common type used today, it takes 4 years for them 
to produce more energy than it took to manufacture them? 

 

And did you know that those energy inputs you speak of that are required in 
order to produce the polysilicon for the PV cells ARE IN FACT factored in to 
solar EROI ratios. So what is your point?
 

 > Energy invested stands  precisely that e.g. for energy invested – NOT just 
 > energy invested that had to be purchased from some other [fossil] energy 
 > producing source on the market place. If a process requires a given energy 
 > input in order to work then this is energy invested – whether or not it was 
 > purchased

 

If so then the EROI for EV

Re: Natural gas: The fracking fallacy

[John Clark]

On Fri, Jan 2, 2015 at 6:01 PM, 'Chris de Morsella' via Everything List <
everything-list@googlegroups.com> wrote:


> > I give you the definition as it is defined in Wikipedia


But I thought Wikipedia was consistently wrong about everything and only
used by shallow people like me.

>
> *> EROI* is the ratio  of the amount
> of usable energy  acquired from a
> particular energy resource to the amount of energy expended to obtain that
> energy resource.
>

Fine,  you did not have to expend any energy for sunlight to fall on a
solar cell , and you did not have to expend any energy to obtain the self
energy of the kerogen to help you convert itself to oil, you get it for
free. And by the way, did you know that with multicrystalline silicon solar
cells, the most common type used today, it takes 4 years for them to
produce more energy than it took to manufacture them?


>  > Energy invested stands  precisely that e.g. for energy invested – NOT
> just energy invested that had to be purchased from some other [fossil]
> energy producing source on the market place. If a process requires a given
> energy input in order to work then this is energy invested – whether or not
> it was purchased
>

If so then the EROI for EVERYTHING is ALWAYS less than one, every process
is a energy sink and nothing is worth doing and the only thing we can do is
what environmentalists have always said we should do, freeze to death in
the dark.

> EROI measures the ratio of ALL required energy inputs with what is
> actually produced.
>

Then the first law of thermodynamics guarantees that the EROI of every
process can never be greater than 1, and the second law of thermodynamics
guarantees that the EROI of every process must always be less than 1.

> You really don’t get it!
>

I might "get it" someday, the day I get Alzheimer's disease.

> EROI measures the NET energy that is available from a produced resource
> after all of the required energy inputs, needed in order to produce a yield
> form the given resource, have been subtracted from the actual energy that
> has  been yielded by the process.
>

Then EROI is utterly useless because the only thing a business man or
anyone else with half a brain is interested in is energy that is available
minus all the energy *THAT YOU PAYED FOR* to obtain that energy.

> Counting only purchased energy is a way of obfuscating the very large and
> significant energy inputs that are required in order to produce any net
> result from kerogen shale and tar sands as well


Holy cow, there you have it right there! To tell the truth for a time  I
was having second thoughts and feeling a little guilty thinking that maybe
I was being too hard on you; I was thinking that you couldn't passably be
as dumb as you seemed to be and so maybe I was just misunderstanding what
you were trying to say. But you're above statement is as clear as it is
imbecilic and so I must conclude that my first impression was correct, you
really are too dumb to walk and chew gum at the same time.

 John K Clark

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RE: Natural gas: The fracking fallacy

['Chris de Morsella' via Everything List]

 

 

From: everything-list@googlegroups.com 
[mailto:everything-list@googlegroups.com] 
Sent: Friday, January 02, 2015 1:20 PM
To: everything-list@googlegroups.com
Subject: Re: Natural gas: The fracking fallacy

 

Not to beat a dead aardvark, but the oil dudes knocked it out of the park with 
shale gas and bakken oil. 

 

That depends on what you mean by “knocked it out of the park”. Given the vast 
amounts of sunk capital that the tight oil sector has required in order to 
produce the yield it has produced I would hardly choose that term. Many of 
these wells are never ever going to pay back the significant capital 
expenditures that were required in order to horizontally drill, frack and then 
produce. 

Why do you think there is a massive capital flight OUT of this sector… a 
capital flight that I might add preceded the current collapse in global oil 
prices and that will only get worse given the recent price collapse. 

You need to look at opportunity cost. Investing on the order of a trillion 
dollars into tight oil (and gas) extraction comes at the opportunity cost of 
lost investment potential into other energy yielding infrastructures. If a 
trillion dollars had been invested in solarizing America I think we would be in 
better shape. One can argue this point, but the fact remains that the shale 
tight oil boom required hundreds and hundreds of billions of dollars of capital 
expenditure in order to manifest this very temporary increase in supply.

Anybody who believes the hype has not looked closely enough at the very steep 
decline rates of tight oil and shale gas. 

For example – as historic data from the Barnett formation (which is the oldest 
produced tight shale gas deposit and thus has the most complete data set) shows 
 the depletion rate is exceptionally rapid. From a peak of production in 2011 
of 6.3 Bcf/day it dropped IN JUST TWO YEARS – to the 4.8 Bcf/day in 2013 – a 
decline of 24% in just two years.

Shale tight oil – and even more so the gas that is being produced by fracking 
shale deposits – is a treadmill of hyper-active drilling just to stay in place. 
Just to keep the current production plateaus (not increasing output yield by a 
single barrel, but just to prevent a collapse in output driven by the super 
high depletion rates) an unsustainable level of new wells need to be drilled 
each and every year. 

This is not going to happen – already the sector has shown that it is 
exhausting its ability to attract new capital. 

 

I do not see how this soon to be imploding tight oil & gas boom – only 
developed at a massive capital cost that has left the capital markets exhausted 
– is “hitting it out of the park”. More like a foul ball or maybe a fly ball 
that will soon result in the end of the inning.

 

See graph:



 

I was completely unexpected by myself, who is normally a pessimist and a 
Libertarian as well. I wish solar of microbial biomass was leading the parade 
in 2014-15, but it hasn't. 

 

And how could it – everything else besides tight oil & gas was capital starved. 
The opportunity cost of the shale tight oil boom is all the lost investments 
and unrealized R&D in other energy sectors that got sidetracked by the couple 
years of mania that got spun up by this bubble.

 

To quote Bill Clinton "We play the hand we're dealt." So we must play this 
hand. BHO did not want this at all, but the capitalists (crony?) went around 
the democrats and their prez. I am the sort of Libertarian who likes creative 
ideas that are not necessarily, the first thing we choose to solve economic and 
social problems. 

 

I hate to think of the coming hangover as these wells enter into very steep 
rapid depletion – as they ARE doing. New wells  cannot be drilled fast enough 
to keep the bubble going.

 

 

If you are a progressive, its the first thing to choose. If libertarianism 
doesn't work, let us say in reducing employment, for example, then fine, back 
to Keynesianism and regulations. We can always to Regulations and Gov control, 
if Freedom fails and we have nothing to relieve the pain.  I am all for being 
practical-minded and would use anything that works best.  

 

My guess is that solar will Boom, and I mean really, Boom, as soon as 
electricity storage and transmission gets the right boost, technically<---   
Similar innovations that sparked up shale gas, could believable spark up solar 
storage.  

Solar PV unit costs continues to go down and global production capacity 
continues to rise. The grids can absorb 25% - 35% of renewable energy without 
needing major investments in order to adapt. When you speak of the need for 
storage – this only becomes a driving factor after the degree of penetration of 
renewables has grown larger than this amount. There is plenty of headroom for 
solar/wind sectors to grow before these kinds of levels of penetration are 
achieved. Incremental improvements in the cost to produce utility scal

RE: Natural gas: The fracking fallacy

['Chris de Morsella' via Everything List]

 

 

From: everything-list@googlegroups.com 
[mailto:everything-list@googlegroups.com] On Behalf Of John Clark
Sent: Friday, January 02, 2015 1:29 PM
To: everything-list@googlegroups.com
Subject: Re: Natural gas: The fracking fallacy

 

On Fri, Jan 2, 2015 'Chris de Morsella' via Everything List 
 wrote:

 

> If 50% of the oil in a reserve must be consumed in order to extract the 
> remaining net energy then tell me why should it not be counted as energy 
> invested? 

 

Because the last I in EROI stands for  "Investment", and so you should only 
include energy that you actually had to pay for.

 

WRONG! Once again you are mistaken, and demonstrate a superficial familiarity 
with EROI and the NET produced available resulting energy that this ratio 
attempts to measure. For your education I give you the definition as it is 
defined in Wikipedia – [yeah I can use the Google machine as well as you can, 
John]

 

In  <http://en.wikipedia.org/wiki/Physics> physics,  
<http://en.wikipedia.org/wiki/Energy_economics> energy economics and  
<http://en.wikipedia.org/wiki/Energetics> ecological energetics, energy 
returned on energy invested (EROEI or ERoEI); or energy return on investment 
(EROI), is the  <http://en.wikipedia.org/wiki/Ratio> ratio of the amount of 
usable  <http://en.wikipedia.org/wiki/Energy> energy acquired from a particular 
energy resource to the amount of energy expended to obtain that energy 
resource. 
<http://en.wikipedia.org/wiki/Energy_returned_on_energy_invested#cite_note-mh2010-1>
 [1] 
<http://en.wikipedia.org/wiki/Energy_returned_on_energy_invested#cite_note-eo-2>
 [2] When the EROEI of a resource is less than or equal to one, that energy 
source becomes an "energy sink", and can no longer be used as a  
<http://en.wikipedia.org/wiki/Primary_energy> primary source of energy.

 

Nowhere in this definition does it mention self-energy or indicate that 
so-called self-energy should not be counted as energy invested when calculating 
EROI. 

 

Energy invested stands  precisely that e.g. for energy invested – NOT just 
energy invested that had to be purchased from some other [fossil] energy 
producing source on the market place. If a process requires a given energy 
input in order to work then this is energy invested – whether or not it was 
purchased on the market or removed from the available NET ENERGY that is 
produced.

 

>>If 80% of the energy falling on a solar cell is wasted (and it is) then 
>>should that be counted as energy invested?

 

Once again your ignorance literally shines through John [and yes the pun was 
intended]. 

In exactly the same way that oil, gas  or coal left in the ground – after all 
extractable resources have been removed -- is not counted as energy invested – 
even though it is not recovered energy… so it is with incident solar energy 
that is not recovered. It is non-captured energy in both cases, but it is NOT 
energy invested in order to produce the NET energy actually delivered. 

I feel like I am explaining EROI to a small child John – do I really have to 
educate you on this?

 

By the way your 80% of incident solar energy not being recovered by PV is 
changing fast. Already in the laboratory yields for solar PV have reached 40%. 
You might as well begin getting used to it John – the future is going to be 
dominated by renewable energy harvesting systems such as wind and solar.

 

If you insist on going down that road then the EROI  number will ALWAYS be  
less than 1 because the conservation of energy says you can't get energy from 
nothing and the second law of thermodynamics says you can't even break even.

 

You really don’t get it! 

EROI measures the NET energy that is available from a produced resource after 
all of the required energy inputs, needed in order to produce a yield form the 
given resource, have been subtracted from the actual energy that has  been 
yielded by the process.

The 1rst and the 2nd law of thermodynamics are tangential and essentially 
irrelevant. EROI instead specifically measures the ratio of the NET output 
energy left after all the energy inputs (and the embedded energy contained in 
the capital and other non-energy resources have been accounted for).

 

> You invented the term “self-energy”


If so then Wikipedia is using my term:

"A 1984 study estimated the EROEI of the various known oil-shale deposits as 
varying between 0.7–13.3. More recent studies estimates the EROEI of oil shales 
to be 2:1 or 16:1  depending on whether self-energy is counted as a cost or 
internal energy is excluded and only purchased energy is counted as input."

Counting only purchased energy is a way of obfuscating the very large and 
significant energy inputs that are required in order to produce any net result 
from kerogen shale (and tar sands as well for example). It is a form of lying 
with numbe

Re: Natural gas: The fracking fallacy

[John Clark]

On Fri, Jan 2, 2015 'Chris de Morsella' via Everything List <
everything-list@googlegroups.com> wrote:

> If 50% of the oil in a reserve must be consumed in order to extract the
> remaining net energy then tell me why should it not be counted as energy
> invested?
>

Because the last I in EROI stands for  "Investment", and so you should only
include energy that you actually had to pay for. If 80% of the energy
falling on a solar cell is wasted (and it is) then should that be counted
as energy invested? If you insist on going down that road then the EROI
number will ALWAYS be  less than 1 because the conservation of energy says
you can't get energy from nothing and the second law of thermodynamics says
you can't even break even.


> > You invented the term “self-energy”


If so then Wikipedia is using my term:

"A 1984 study estimated the EROEI of the various known oil-shale deposits
as varying between 0.7–13.3. More recent studies estimates the EROEI of oil
shales to be 2:1 or 16:1  *depending on whether self-energy is counted as a
cost or internal energy is excluded and only purchased energy is counted as
input."*

The environmental lobbyists over at The Western Resource Advocates are also
using my term:

"Oil shale’s Energy Return on Investment (EROI) is extremely low, falling
between 1:1 and 2:1 when* self-energy—the energy released by the oil shale
conversion process that is used to power that operation—is counted as a
cost."*

A hell of a lot of other people are using my term too, a Google search for
self-energy and kerogen oil shale gives 15,100 results.


> > There is also an environmental cost of burning all this carbon fossil
> fuel in the extraction process
>

That is a different issue and might or might not be a good reason for not
turning to kerogen, but even if you think it would cause too much
environmental damage it would be dishonest to generate phoney EROI numbers
to try to get people not to use it.

  John K Clark

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Re: Natural gas: The fracking fallacy

[spudboy100 via Everything List]

Not to beat a dead aardvark, but the oil dudes knocked it out of the park with 
shale gas and bakken oil. I was completely unexpected by myself, who is 
normally a pessimist and a Libertarian as well. I wish solar of microbial 
biomass was leading the parade in 2014-15, but it hasn't. To quote Bill Clinton 
"We play the hand we're dealt." So we must play this hand. BHO did not want 
this at all, but the capitalists (crony?) went around the democrats and their 
prez. I am the sort of Libertarian who likes creative ideas that are not 
necessarily, the first thing we choose to solve economic and social problems. 
If you are a progressive, its the first thing to choose. If libertarianism 
doesn't work, let us say in reducing employment, for example, then fine, back 
to Keynesianism and regulations. We can always to Regulations and Gov control, 
if Freedom fails and we have nothing to relieve the pain.  I am all for being 
practical-minded and would use anything that works best. 


My guess is that solar will Boom, and I mean really, Boom, as soon as 
electricity storage and transmission gets the right boost, technically<---   
Similar innovations that sparked up shale gas, could believable spark up solar 
storage.  



-Original Message-
From: John Clark 
To: everything-list 
Sent: Fri, Jan 2, 2015 2:25 pm
Subject: Re: Natural gas: The fracking fallacy


On Fri, Jan 2, 2015  'Chris de Morsella' via Everything List 
 wrote:


> The big gusher oil wells in Texas, Saudi Arabia, Kuwait, Mexico had EROI of 
> better than 100:1.
The EROI most certainly was not 100, not if you include the internal energy of 
the crude oil as part of the cost of investment, it would ALWAYS be less than 
one; of course only a fool or a liar would include the internal energy of the 
crude oil as part of the cost of the investment, but you and your environmental 
buddies do it for Kerogen so why not do it for crude oil too? There are only 2 
reasons I can think of for not doing that, integrity and brains. 
 




 > you libertarian moron.






Opinions differ on the moron part but I am certainly a libertarian. Do you have 
a problem with that?  







>> And there is also something called the second  law of thermodynamics and if 
>> you use that too you can ensure that the EROI never even gets as high as 1, 
>> it's always less, and so nothing, absolutely positively nothing, is worth 
>> doing. That's all you need to come up with EROI numbers that are always as 
>> low as you want them to be. Well.., you need one other thing, a desire to 
>> deceive. 





 







 > Show me an actual commercially producing shale oil operation?






I will just as soon as you show me a place where oil can be sold for more than 
$120 a barrel. I don't dispute that with oil selling as cheaply as it is today 
it's not economical with existing technology, but to say as you do that it will 
never be economical no matter how high oil sells for flies in the face of 
reality.


 > Screw those BS numbers.



Yes screw Wikipedia and everybody else,  believe in Chris de Morsella's 
prejudices.   









 > In 1982 Exxon threw in the towel after dumping some $5 billion down the 
 > shale oil money pit.






In 1837 Charles Babbage used 1837 technology to try to make the first fully 
programmable digital computer, but after dumping the equivalent of many 
millions of dollars into that money pit he threw in the towel. In 2015 people 
use 2015 technology and can make computers successfully. In 1982 Exxon was 
using 1982 technology, today they use 2015 technology.   





 > John I don’t think you understand how EROI numbers are produced






I understand it one hell of a lot better than you do. First you say the true 
EROI numbers are 2.5:1 but that was inconsistent with everything you were 
saying, when I pointed this out you correct that to 1:2.5, but nobody familiar 
with EROI would state it that way, they'd say .4:1. Never mind that even your 
room temperature IQ environmental buddies would say it's 2 not .4, my point is 
that even your erroneous information is stated in a ignorant manner.  



> or what they seek to measure.

 
When you or environmental morons generate EROI numbers they don't measure 
anything at all except the magnitude of the desire to deceive, the lower the 
number the greater the deception. 



> I suggest you read Charles Hall’s seminal work on EROI to get a more in depth 
> understanding.



Why on earth would I follow a recommendation of yours about EROI when you've 
demonstrated not just ignorance but dishonesty on this subject? By now we both 
know that a EROI figure of .4 for Kerogen is bullshit, and yet you continue to 
try to convince people of it. 







>> ive seconds is all it takes to prove that you're dead wrong. I was wrong a 
>> while back and w

RE: Natural gas: The fracking fallacy

['Chris de Morsella' via Everything List]

 

 

From: everything-list@googlegroups.com 
[mailto:everything-list@googlegroups.com] On Behalf Of John Clark
Sent: Friday, January 02, 2015 11:25 AM
To: everything-list@googlegroups.com
Subject: Re: Natural gas: The fracking fallacy

 

On Fri, Jan 2, 2015  'Chris de Morsella' via Everything List 
 wrote:

> The big gusher oil wells in Texas, Saudi Arabia, Kuwait, Mexico had EROI of 
> better than 100:1.

The EROI most certainly was not 100, not if you include the internal energy of 
the crude oil as part of the cost of investment,

 

The fact that you keep going back to this concept of internal energy makes it 
clear to me that you don’t have a clue what EROI measures. Educate yourself 
then get back to me. I am tired of teaching you the basics.

 

 

 

it would ALWAYS be less than one; of course only a fool or a liar would include 
the internal energy of the crude oil as part of the cost of the investment, but 
you and your environmental buddies do it for Kerogen so why not do it for crude 
oil too? There are only 2 reasons I can think of for not doing that, integrity 
and brains. 

 

If 50% of the oil in a reserve must be consumed in order to extract the 
remaining net energy then tell me why should it not be counted as energy 
invested? The fact of the matter though is that this is not the case – 
especially for the gusher type wells of big high pressure fields – the oil 
gushes out. The only energy invested is the energy required to sink the well 
and lay the pipelines (plus pumping stations) to transport the oil to the 
refinery or the tanker terminal.

The difficulty you have understanding this leads me to question both your 
integrity and your brains.

 

> you libertarian moron.

 

Opinions differ on the moron part but I am certainly a libertarian. Do you have 
a problem with that?  

 

I have a problem with your obnoxious attitudes towards those who do not share 
your own ideological firmament. I do have a problem with your brand of 
Libertarianism because of all the ideological baggage you have piled on to it.

 

 

 

>> And there is also something called the second  law of thermodynamics and if 
>> you use that too you can ensure that the EROI never even gets as high as 1, 
>> it's always less, and so nothing, absolutely positively nothing, is worth 
>> doing. That's all you need to come up with EROI numbers that are always as 
>> low as you want them to be. Well.., you need one other thing, a desire to 
>> deceive. 

 

 > Show me an actual commercially producing shale oil operation?

I will just as soon as you show me a place where oil can be sold for more than 
$120 a barrel. I don't dispute that with oil selling as cheaply as it is today 
it's not economical with existing technology, but to say as you do that it will 
never be economical no matter how high oil sells for flies in the face of 
reality.

Oil cracked through the $120 a barrel price point on several occasions over the 
last years and was hovering well above $100 for some years – where were all the 
Kerogen developments lining up in funding the pipeline…. As they would have 
been if you were correct? 

There was almost nothing – no rush of promising startups knocking at the gates 
of venture capitalists with plans to develop kerogen. 

I smell more BS on your part – the clue being your carefully chosen floor price 
of $120, which was just above the plateau hovering around $110 that oil was at 
for several years following the last big price crash of 2008-2009.

 > Screw those BS numbers.

 

Yes screw Wikipedia and everybody else,  believe in Chris de Morsella's 
prejudices.   

No I just screw BS artists like you John who quote BS numbers that are not 
based on anything actually real.

> In 1982 Exxon threw in the towel after dumping some $5 billion down the shale 
> oil money pit.

In 1837 Charles Babbage used 1837 technology to try to make the first fully 
programmable digital computer, but after dumping the equivalent of many 
millions of dollars into that money pit he threw in the towel. In 2015 people 
use 2015 technology and can make computers successfully. In 1982 Exxon was 
using 1982 technology, today they use 2015 technology.   

And do you see Exxon rushing to get back into the Kerogen extraction game in 
2015? 

NO YOU DO NOT BECAUSE THEY ARE NOT TOUCHING THAT CRAP WITH A TEN FOOT POLE

 

 > John I don’t think you understand how EROI numbers are produced

 

I understand it one hell of a lot better than you do. 

BS John – I doubt you even know who Charles Hall is. You display unwarranted 
arrogance believing your own BS is manna from heaven. 

First you say the true EROI numbers are 2.5:1 but that was inconsistent with 
everything you were saying, when I pointed this out you correct that to 1:2.5, 
but nobody familiar with EROI would state it that way, they'd say .4:1. Never 
mind that even your room

Re: Natural gas: The fracking fallacy

[zibblequibble]

On Friday, January 2, 2015 7:25:15 PM UTC, John Clark wrote:
>
> On Fri, Jan 2, 2015  'Chris de Morsella' via Everything List <
> everyth...@googlegroups.com > wrote:
>
> > The big gusher oil wells in Texas, Saudi Arabia, Kuwait, Mexico had EROI 
> of better than 100:1.
>
> The EROI most certainly was not 100, not if you include the internal 
> energy of the crude oil as part of the cost of investment, it would ALWAYS 
> be less than one; of course only a fool or a liar would include the 
> internal energy of the crude oil as part of the cost of the investment, but 
> you and your environmental buddies do it for Kerogen so why not do it for 
> crude oil too? There are only 2 reasons I can think of for not doing that, 
> integrity and brains. 
>  
>
>> > you libertarian moron.
>>
>
> Opinions differ on the moron part but I am certainly a libertarian. Do you 
> have a problem with that?  
>
>>
>> >> And there is also something called the second  law of thermodynamics 
>>> and if you use that too you can ensure that the EROI never even gets as 
>>> high as 1, it's always less, and so nothing, absolutely positively nothing, 
>>> is worth doing. That's all you need to come up with EROI numbers that are 
>>> always as low as you want them to be. Well.., you need one other thing, a 
>>> desire to deceive. 
>>>
>>  
>>
>  > Show me an actual commercially producing shale oil operation?
>>
> I will just as soon as you show me a place where oil can be sold for more 
> than $120 a barrel. I don't dispute that with oil selling as cheaply as it 
> is today it's not economical with existing technology, but to say as you do 
> that it will never be economical no matter how high oil sells for flies in 
> the face of reality.
>
>  > Screw those BS numbers.
>>
>
> Yes screw Wikipedia and everybody else,  believe in Chris de Morsella's 
> prejudices.   
>
> > In 1982 Exxon threw in the towel after dumping some $5 billion down the 
>> shale oil money pit.
>>
> In 1837 Charles Babbage used 1837 technology to try to make the first 
> fully programmable digital computer, but after dumping the equivalent of 
> many millions of dollars into that money pit he threw in the towel. In 2015 
> people use 2015 technology and can make computers successfully. In 1982 
> Exxon was using 1982 technology, today they use 2015 technology.   
>
>  > John I don’t think you understand how EROI numbers are produced
>>
>
> I understand it one hell of a lot better than you do. First you say the 
> true EROI numbers are 2.5:1 but that was inconsistent with everything you 
> were saying, when I pointed this out you correct that to 1:2.5, but nobody 
> familiar with EROI would state it that way, they'd say .4:1. Never mind 
> that even your room temperature IQ environmental buddies would say it's 2 
> not .4, my point is that even your erroneous information is stated in a 
> ignorant manner.  
>
> > or what they seek to measure.
>>
>  
> When you or environmental morons generate EROI numbers they don't measure 
> anything at all except the magnitude of the desire to deceive, the lower 
> the number the greater the deception. 
>
> > I suggest you read Charles Hall’s seminal work on EROI to get a more in 
>> depth understanding.
>>
>
> Why on earth would I follow a recommendation of yours about EROI when 
> you've demonstrated not just ignorance but dishonesty on this subject? By 
> now we both know that a EROI figure of .4 for Kerogen is bullshit, and yet 
> you continue to try to convince people of it. 
>
> >> ive seconds is all it takes to prove that you're dead wrong. I was 
>>> wrong a while back and when it became clear to me that I had made a mistake 
>>> I admitted it, do you have the intellectual courage to do the same thing?
>>>
>> > Yeah right LOL -- Mr. Wikipedia. You have not proved anything.
>>
>
> Well I've certainly proved one thing, I've proved that Mr. Chris de 
> Morsella is a intellectual coward incapable of admitting he's wrong even 
> when it's clear as a bell that he is. 
>
>   John K Clark
>

johnny johnny johnny !!!  you are kick ass johnny boy!  
https://www.youtube.com/watch?v=7miRCLeFSJo

>
>  
>

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Re: Natural gas: The fracking fallacy

[John Clark]

On Fri, Jan 2, 2015  'Chris de Morsella' via Everything List <
everything-list@googlegroups.com> wrote:

> The big gusher oil wells in Texas, Saudi Arabia, Kuwait, Mexico had EROI
of better than 100:1.

The EROI most certainly was not 100, not if you include the internal energy
of the crude oil as part of the cost of investment, it would ALWAYS be less
than one; of course only a fool or a liar would include the internal energy
of the crude oil as part of the cost of the investment, but you and your
environmental buddies do it for Kerogen so why not do it for crude oil too?
There are only 2 reasons I can think of for not doing that, integrity and
brains.


> > you libertarian moron.
>

Opinions differ on the moron part but I am certainly a libertarian. Do you
have a problem with that?

>
> >> And there is also something called the second  law of thermodynamics
>> and if you use that too you can ensure that the EROI never even gets as
>> high as 1, it's always less, and so nothing, absolutely positively nothing,
>> is worth doing. That's all you need to come up with EROI numbers that are
>> always as low as you want them to be. Well.., you need one other thing, a
>> desire to deceive.
>>
>
>
 > Show me an actual commercially producing shale oil operation?
>
I will just as soon as you show me a place where oil can be sold for more
than $120 a barrel. I don't dispute that with oil selling as cheaply as it
is today it's not economical with existing technology, but to say as you do
that it will never be economical no matter how high oil sells for flies in
the face of reality.

 > Screw those BS numbers.
>

Yes screw Wikipedia and everybody else,  believe in Chris de Morsella's
prejudices.

> In 1982 Exxon threw in the towel after dumping some $5 billion down the
> shale oil money pit.
>
In 1837 Charles Babbage used 1837 technology to try to make the first fully
programmable digital computer, but after dumping the equivalent of many
millions of dollars into that money pit he threw in the towel. In 2015
people use 2015 technology and can make computers successfully. In 1982
Exxon was using 1982 technology, today they use 2015 technology.

 > John I don’t think you understand how EROI numbers are produced
>

I understand it one hell of a lot better than you do. First you say the
true EROI numbers are 2.5:1 but that was inconsistent with everything you
were saying, when I pointed this out you correct that to 1:2.5, but nobody
familiar with EROI would state it that way, they'd say .4:1. Never mind
that even your room temperature IQ environmental buddies would say it's 2
not .4, my point is that even your erroneous information is stated in a
ignorant manner.

> or what they seek to measure.
>

When you or environmental morons generate EROI numbers they don't measure
anything at all except the magnitude of the desire to deceive, the lower
the number the greater the deception.

> I suggest you read Charles Hall’s seminal work on EROI to get a more in
> depth understanding.
>

Why on earth would I follow a recommendation of yours about EROI when
you've demonstrated not just ignorance but dishonesty on this subject? By
now we both know that a EROI figure of .4 for Kerogen is bullshit, and yet
you continue to try to convince people of it.

>> ive seconds is all it takes to prove that you're dead wrong. I was wrong
>> a while back and when it became clear to me that I had made a mistake I
>> admitted it, do you have the intellectual courage to do the same thing?
>>
> > Yeah right LOL -- Mr. Wikipedia. You have not proved anything.
>

Well I've certainly proved one thing, I've proved that Mr. Chris de
Morsella is a intellectual coward incapable of admitting he's wrong even
when it's clear as a bell that he is.

  John K Clark

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RE: Natural gas: The fracking fallacy

['Chris de Morsella' via Everything List]

 

 

From: everything-list@googlegroups.com 
[mailto:everything-list@googlegroups.com] On Behalf Of John Clark
Sent: Thursday, January 01, 2015 12:56 AM
To: everything-list@googlegroups.com
Subject: Re: Natural gas: The fracking fallacy

 

On Tue, Dec 30, 2014 at 3:26 PM, 'Chris de Morsella' via Everything List 
 wrote:

> You are misrepresenting EROI numbers 

Let's talk a little about misrepresenting EROI numbers. There is something 
called the first law of thermodynamics and it says that no process can produce 
energy from nothing, so if you count self energy as you and environmentalist 
morons do you can ensure that the EROI number for ANYTHING never gets above 1. 

 

You use the word “morons”; then in the same breath go on to utter moronic 
things such as EROI never getting above one. The big gusher oil wells in Texas, 
Saudi Arabia, Kuwait, Mexico had EROI of better than 100:1. The energy used to 
drill and operate the well, pumping networks etc. to the tanker terminal 
yielded petroleum with a hundred times the invested energy. Which is why they 
were called gushers you libertarian moron. 

 

And there is also something called the second  law of thermodynamics and if you 
use that too you can ensure that the EROI never even gets as high as 1, it's 
always less, and so nothing, absolutely positively nothing, is worth doing. 
That's all you need to come up with EROI numbers that are always as low as you 
want them to be. Well.., you need one other thing, a desire to deceive. 


 

>> Wikipedia says:  

"A 1984 study estimated the EROEI of the various known oil-shale deposits as 
varying between 0.7–13.3. More recent studies estimates the EROEI of oil shales 
to be 2:1 or 16:1  depending on whether self-energy is counted as a cost or 
internal energy is excluded and only purchased energy is counted as input.

> What do those numbers have to do with kerogen shale extraction.

THE ARTICLE IS ABOUT KEROGEN OIL EXTRACTION! See for yourself:

What are those numbers based on. Believe what you will. Show me an actual 
commercially producing shale oil operation? Show me some actual operating 
process that is generating actual data that can actually be measured and used 
to provide a realistic statistical basis upon which to make a judgment.

YOU CAN’T, BECAUSE THERE ARE NONE!

The biggest thing going now in kerogen extraction is probably a small startup 
shale energy company in Utah called RedLeaf Resources… that has some permits 
and  a plan and that is it.

NO DATA!

Screw those BS numbers. They are not based on anything real like an existing 
industrial scale operation. Unless you can show actual real world data then all 
you got is somebodies projections based on their assumptions. And as history 
has shown the EIA and the IEA have made highly optimistic projections in the 
past that have proven wrong and had to be seriously downgraded.

You have nothing because there is nothing! There is no kerogen extraction 
sector to speak of. In 1982 Exxon threw in the towel after dumping some $5 
billion down the shale oil money pit. The DOE threw some $10 billion trying to 
jump start the sector; that decades long effort was also abandoned. Shell Oil 
recently also called it quits with kerogen extraction. 

If it is so hot then why has every major attempt to extract it commercially in 
the US gone under or been shut down?

In the end it is the facts that speak John and the fact of the matter is that 
there is no existing kerogen extraction sector to speak of in the US; nor is 
there any on the horizon.

http://en.wikipedia.org/wiki/Shale_oil

At the very beginning of the article it warns that if you're interested in 
"tight oil" which is sometimes also called shale oil it recommends a completely 
different article. The article I quoted also says:

 

"Shale oil is extracted by pyrolysis, hydrogenation, or thermal dissolution of 
oil shale. The pyrolysis of the rock is performed in a retort, situated either 
above ground or within the rock formation itself. As of 2008, most oil shale 
industries perform the shale oil extraction process after the rock is mined, 
crushed and transported to a retorting facility, although several experimental 
technologies perform the process in place (in-situ). The temperature at which 
the KEROGEN decomposes into usable hydrocarbons varies with the time-scale of 
the process" 

> And argument from authority is very often the cover of those who have no 
> argument of any worth themselves

 

So I should renounce Wikipedia's authority but embrace Chris de Morsella's 
authority. Everybody is wrong except you.

 

I am impressed John you demonstrated the aptitude to search google and find a 
Wikipedia entry. 

What are those numbers – you choose to uncritically accept – based on? On what 
actual data? Data from what? When there is no existing commercial scale 
operations to generate such data operatin

Re: Natural gas: The fracking fallacy

[John Clark]

On Tue, Dec 30, 2014 at 3:26 PM, 'Chris de Morsella' via Everything List <
everything-list@googlegroups.com> wrote:

> You are misrepresenting EROI numbers
>
Let's talk a little about misrepresenting EROI numbers. There is something
called the first law of thermodynamics and it says that no process can
produce energy from nothing, so if you count self energy as you and
environmentalist morons do you can ensure that the EROI number for ANYTHING
never gets above 1. And there is also something called the second  law of
thermodynamics and if you use that too you can ensure that the EROI never
even gets as high as 1, it's always less, and so nothing, absolutely
positively nothing, is worth doing. That's all you need to come up with
EROI numbers that are always as low as you want them to be. Well.., you
need one other thing, a desire to deceive.


> >> Wikipedia says:
>>
>> "A 1984 study estimated the EROEI of the various known oil-shale deposits
>> as varying between 0.7–13.3. More recent studies estimates the EROEI of oil
>> shales to be 2:1 or 16:1  depending on whether self-energy is counted as a
>> cost or internal energy is excluded and only purchased energy is counted as
>> input.
>>
> > What do those numbers have to do with kerogen shale extraction.
>
THE ARTICLE IS ABOUT KEROGEN OIL EXTRACTION! See for yourself:
http://en.wikipedia.org/wiki/Shale_oil

At the very beginning of the article it warns that if you're interested in
"tight oil" which is sometimes also called shale oil it recommends a
completely different article. The article I quoted also says:

"Shale oil is extracted by pyrolysis, hydrogenation, or thermal dissolution
of oil shale. The pyrolysis of the rock is performed in a retort, situated
either above ground or within the rock formation itself. As of 2008, most
oil shale industries perform the shale oil extraction process after the
rock is mined, crushed and transported to a retorting facility, although
several experimental technologies perform the process in place (in-situ).
The temperature at which the *KEROGEN* decomposes into usable hydrocarbons
varies with the time-scale of the process"

> > And argument from authority is very often the cover of those who have no
> argument of any worth themselves


So I should renounce Wikipedia's authority but embrace Chris de Morsella's
authority. Everybody is wrong except you.


> > Is your understanding of energy matters is only Wikipedia deep perhaps?


Wikipedia flatly contradicts you, even a bunch of wacky tree huggers
contradicts you, but you still insist you're right. So tell me, do you
honestly believe you are being intellectually honest  right now? Is this a
moment you're going to look back on with pride?

> You are confusing and conflating apples and oranges again.


At one time I confused tight oil and oil from kerogen oil shale but you
corrected my mistake and I thank you for that because although it was a
little embarrassing I learned from my mistake and that's much more
important. And now it's your turn to be confused by the difference between
tight oil and oil from kerogen oil shale, but unlike me you do not learn
from your mistakes.


> > Any liquid oil that has been cooked from the kerogen is sold.
>
The liquid oil is a solid? And by the way, all oil was probably kerogen at
one point in it's life until the the heat of the Earth cooled it into crude
oil.

> The needed energy inputs would come from electricity.
>
The needed heat energy need not come from electricity, it could come from
anything, and a large part of that heat would come from the self energy of
the Kerogen itself. It's exactly the same with crude oil, when you refine a
pound of crude oil the resulting gasoline produced from it has less
chemical energy than the original crude oil, energy is conserved so the
difference is released  as heat. Does this mean that it takes more energy
to refine crude oil than the energy you get out of it? Yes, if self-energy
is counted as a cost,  but only a moron would do that, or a swindler who
wanted to make the EROI number look bad.

> I’ve been noticing that you seem to have a tendency to shoot your mouth
> off John. What do you actually know about kerogen extraction processes?
>
Not a lot but clearly one hell of a lot more than you do.

> Please don’t point me to some Wikipedia article you googled in five
> seconds;
>
Because five seconds is all it takes to prove that you're dead wrong. I was
wrong a while back and when it became clear to me that I had made a mistake
I admitted it, do you have the intellectual courage to do the same thing.

> "Oil shale’s Energy Return on Investment (EROI) is extremely low, falling
>>> between 1:1 and 2:1 when self-energy—the energy released by the oil shale
>>> conversion process that is used to power that operation—is counted as a
>>> cost."
>>>
>>
>> > And who funded this study which came out with these shamefully
>> misleading figures? The Western Resource Advocates, a organization of
>> environmen

RE: Natural gas: The fracking fallacy

['Chris de Morsella' via Everything List]

 

 

From: everything-list@googlegroups.com 
[mailto:everything-list@googlegroups.com] On Behalf Of John Clark
Sent: Tuesday, December 30, 2014 10:55 PM
To: everything-list@googlegroups.com
Subject: Re: Natural gas: The fracking fallacy

 

On Tue, Dec 30, 2014 at 3:26 PM, 'Chris de Morsella' via Everything List 
 wrote:

 

>>> Perhaps the existence of this string of failures and no corresponding list 
>>> of success stories should tell you that maybe, just maybe those 2.5:1 EROI 
>>> numbers I gave are on the mark.


>> I'm confused. I think you're using some weird EROI convention because 
>> usually  EROI numbers are always compared to 1 and so any EROI number above 
>> 1 is a net energy generator;  2.5: 1 would mean you'd get 2.5 times as much 
>> energy out as you put in and thus would be worth doing, but that doesn't 
>> seem to be what you're saying. I think you mean 1:2.5  or as compared to 1  
>> .4:1 or better yet just .4 . I need for you to clarify this point because I 
>> can't debate you when I'm not sure what you're saying.

 

> oops, my bad; I inadvertently transposed the positions.

 

>>Shame on you, I never things transpose. But I'm starting to understand where 
>>you're getting those strange numbers and strange ideas about economics and 
>>energy.

 

Such colorful language Mr. Clark…. Strange indeed. My ideas on economics and 
energy are what they are; your beginning your reply to the EROI by calling them 
strange is itself a strange manner of engaging in discourse.

 

> I should have said and meant to say 1:2.5 that is one unit of energy out for 
> every 2.5 units of energy put in.

>>Wikipedia says:

 

And argument from authority is very often the cover of those who have no 
argument of any worth themselves. Is your understanding of energy matters is 
only Wikipedia deep perhaps?

 

"A 1984 study estimated the EROEI of the various known oil-shale deposits as 
varying between 0.7–13.3. More recent studies estimates the EROEI of oil shales 
to be 2:1 or 16:1  depending on whether self-energy is counted as a cost or 
internal energy is excluded and only purchased energy is counted as input."

What do those numbers have to do with kerogen shale extraction. You are 
confusing and conflating apples and oranges again. I have gone through this 
with you before and you claimed to have understood the substantial and critical 
difference between tight oil bearing shale deposits and kerogen shale (which 
most of the hydrocarbon shale resources are)

The EROI of tight oil from shale in the best sweet spots has zilch, nada, 
nothing to do with the EROI of kerogen bearing shale. Why don’t you tell me why 
you continue to try to present these two very different resources as if they 
were one and the same? 

After all this back and forth I doubt you can still remain so profoundly  
ignorant of the salient fact that in one case it is oil trapped in 
micro-recesses in the shale while in the other it is a waxy substance called 
kerogen that will not flow and needs instead to be cooked out of the rock mass 
– at immense expense of energy inputs.

 

 

Wow, forget about cooking the oil shale, this is cooking the books! Why on 
earth would anybody include the self energy of the Kerogen, which costs 
absolutely nothing, as part of the energy COST of converting Kerogen to oil?? I 
can think of only one reason for doing so, to make the ERORI figures look worse 
than they really are. 

If that is the only possible reason you can think of I must question your 
intelligence Mr. Clark. Why on earth would anybody in their right mind burn 
something of high value – the extracted liquid that has been cooked out of the 
kerogen – in order to make electricity with which to heat electric heating 
coils embedded in sunk wells in the rock mass that is to be heated – when Dah 
they could instead burn cheap brown coal. 

Any liquid oil that has been cooked from the kerogen is sold. That is the 
product. The needed energy inputs would come from electricity. There is a 
reason for this – you claim to be a smart fellow – why electricity? Ask your 
wetware why John? How do you heat the three dimensional mass of presumably well 
fracked shale rock – and do so in place – in order to cook the kerogen it 
contains into a useful and crucially EXTRACTABLE product? 

Mining the rock and pulverizing it is out of the question – far, far too 
expensive. The oil has to be extracted in place. So how do you do it genius? 
You need to raise the temperature of the entire shale rock mass up to a 
processing temperature of 350 degrees C. You made noises about self-energy – 
well? Where, how? The kerogen in the shale rock is not going to provide you 
with any energy until you have first extracted it from the shale rock matrix.

People who have actually made it th

Re: Natural gas: The fracking fallacy

[John Clark]

On Tue, Dec 30, 2014 at 3:26 PM, 'Chris de Morsella' via Everything List <
everything-list@googlegroups.com> wrote:

>
> >>> Perhaps the existence of this string of failures and no corresponding
>>> list of success stories should tell you that maybe, just maybe those 2.5:1
>>> EROI numbers I gave are on the mark.
>>>
>>
>> >> I'm confused. I think you're using some weird EROI convention because
>> usually  EROI numbers are always compared to 1 and so any EROI number above
>> 1 is a net energy generator;  2.5: 1 would mean you'd get 2.5 times as much
>> energy out as you put in and thus would be worth doing, but that doesn't
>> seem to be what you're saying. I think you mean 1:2.5  or as compared to 1
>>  .4:1 or better yet just .4 . I need for you to clarify this point because
>> I can't debate you when I'm not sure what you're saying.
>>
>
>
> oops, my bad; I inadvertently transposed the positions.
>

Shame on you, I never things transpose. But I'm starting to understand
where you're getting those strange numbers and strange ideas about
economics and energy.


> > I should have said and meant to say 1:2.5 that is one unit of energy out
> for every 2.5 units of energy put in.
>
> Wikipedia says:

"A 1984 study estimated the EROEI of the various known oil-shale deposits
as varying between 0.7–13.3. More recent studies estimates the EROEI of oil
shales to be 2:1 or 16:1  *depending on whether self-energy is counted as a
cost* *or internal energy is excluded and only purchased energy is counted
as input.*"

Wow, forget about cooking the oil shale, this is cooking the books! Why on
earth would anybody include the self energy of the Kerogen, which costs
absolutely nothing, as part of the energy COST of converting Kerogen to
oil?? I can think of only one reason for doing so, to make the ERORI
figures look worse than they really are. And who would want to do something
like that? My old friends the environmentalists. And sure enough a very
recent report came out that said:

"Oil shale’s Energy Return on Investment (EROI) is extremely low, falling
between 1:1 and 2:1

*when self-energy—the energy released by the oil shale conversion process
that is used to power that operation—is counted as a cost."*
And who funded this study which came out with these shamefully misleading
figures? The Western Resource Advocates, a organization of environmental
lobbyists. But claiming its 1:2.5 is going too far even for most
environmental loonies.

Look, despite what you may think I'm really not a huge fan of oil shale or
even oil in general, I think there are better energy alternatives either
now or in the near future, but I think we should play fair and not fudge
the numbers to accommodate our personal likes and dislikes.

  John K Clark

>

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Re: Natural gas: The fracking fallacy

['Chris de Morsella' via Everything List]

  From: John Clark 
 To: everything-list@googlegroups.com 
 Sent: Tuesday, December 30, 2014 12:04 PM
 Subject: Re: Natural gas: The fracking fallacy
   
On Sun, Dec 28, 2014 at 12:16 AM, 'Chris de Morsella' via Everything List 
 wrote:
 
> Look at the history of attempts at kerogen extraction. How did all of these 
> attempts end? 

None of them could make money off of kerogen if oil was selling at less than 
$60 a barrel as it is now.
 
> Perhaps the existence of this string of failures and no corresponding list of 
> success stories should tell you that maybe, just maybe those 2.5:1 EROI 
> numbers I gave are on the mark. 

I'm confused. I think you're using some weird EROI convention because usually  
EROI numbers are always compared to 1 and so any EROI number above 1 is a net 
energy generator;  2.5: 1 would mean you'd get 2.5 times as much energy out as 
you put in and thus would be worth doing, but that doesn't seem to be what 
you're saying. I think you mean 1:2.5  or as compared to 1  .4:1 or better yet 
just .4 . I need for you to clarify this point because I can't debate you when 
I'm not sure what you're saying.
oops, my bad; I inadvertently transposed the positions. I should have said and 
meant to say 1:2.5 that is one unit of energy out for every 2.5 units of energy 
put in. EROEI -- (often also called: EROI) -- is a handy, calculated big number 
ratio that can give a global overall sense of the energetic accounting for some 
product or process, but it is not a hard number and its value will change 
depending on what boundary conditions one uses for determining how to account 
for energy inputs and costs (what gets counted and what conversely does not). 
EROEI also does not capture the relative value of different energy sources. For 
example the energy content of brown coal is of a significantly lower value -- 
both market and in terms of overall usefulness -- as an equivalent (in terms of 
energy content) amount of say gasoline. For this reason it may (and I repeat 
the word MAY to emphasise the case by case need to evaluate each single 
scenario) make sense to use more energy to produce less energy, but that is in 
a form which is valuable and more useful than -- in this example -- the energy 
contained in the brown coal.If one understands these caveats and has access to 
the methodology used to calculate the result ratio it is a useful means of 
comparing systems and evaluating the profitability (in energy terms) of doing 
something one way or another.

 John K Clark


   
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Re: Natural gas: The fracking fallacy

[John Clark]

On Sun, Dec 28, 2014 at 12:16 AM, 'Chris de Morsella' via Everything List <
everything-list@googlegroups.com> wrote:


> > Look at the history of attempts at kerogen extraction. How did all of
> these attempts end?
>

None of them could make money off of kerogen if oil was selling at less
than $60 a barrel as it is now.


> > Perhaps the existence of this string of failures and no corresponding
> list of success stories should tell you that maybe, just maybe those 2.5:1
> EROI numbers I gave are on the mark.
>

I'm confused. I think you're using some weird EROI convention because
usually  EROI numbers are always compared to 1 and so any EROI number above
1 is a net energy generator;  2.5: 1 would mean you'd get 2.5 times as much
energy out as you put in and thus would be worth doing, but that doesn't
seem to be what you're saying. I think you mean 1:2.5  or as compared to 1
.4:1 or better yet just .4 . I need for you to clarify this point because I
can't debate you when I'm not sure what you're saying.

 John K Clark

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RE: Natural gas: The fracking fallacy

['Chris de Morsella' via Everything List]

 

 

From: everything-list@googlegroups.com 
[mailto:everything-list@googlegroups.com] On Behalf Of John Clark
Sent: Saturday, December 27, 2014 4:05 PM
To: everything-list@googlegroups.com
Subject: Re: Natural gas: The fracking fallacy

 

On Sat, Dec 27, 2014  'Chris de Morsella' via Everything List 
 wrote:

 

> A lot of the bets made in the US shale boom are not going to pay off for the 
> investors holding on to the debt; holding those one or two year duration 
> futures hedge contracts priced at $90 a barrel. After all these investors get 
> burned – or IMO more likely the US taxpayers get stuck with the bill bailing 
> out the too big to fail banks that have bet heavily in this sector and are 
> the major holders of these seriously underwater futures contracts

 

But if you're right and oil production falls then the price of oil will go up; 
if oil is selling at $200 a barrel and I have a futures contract saying that I 
can buy oil at $90 then far from being underwater my contract is worth $110. 
But if oil is selling at $80 and I have a contract saying I can buy it at $90 
then it's underwater and worth nothing.

 

Sure the holders of those contracts would make a killing, but given the 
momentum behind the current price swing and the one or two year (max) term on 
those future contracts I don’t see much chance of that scenario actually 
manifesting. Oil production will fall in the medium term as the result of a 
wave of bankruptcies. In the short term, perversely low oil prices are driving 
some in debt drillers to sell everything they can – even at a loss, because 
they need revenue. There is a lot of selling into the panic going on because 
for the small to medium sized credit dependent operators they need revenue.

 

I should add that historically the higher the price of oil gets the more money 
the oil companies make. The way oil companies would get burned is if you're 
wrong and oil production continues to rise and thus the price of oil continues 
to fall.   

 

Oil companies make money on the spread between what they can produce it for and 
what the market is willing to pay; the higher the spread the higher the profit. 
Low cost producers make more money for each barrel of oil they sell at any 
given price than higher priced producers.

These chaotic price swings – and we have been here before on wild rides both up 
and down with oil – are hugely damaging to the smooth operation of what are 
projects with an exceedingly long development upstream timeline from discovery 
to producing field. These price swings, choke up the capital market and cause 
massive disruptions later on in the supply side of the business. Sure 
eventually supply rises as capital rushes in to the sector, but the harm from 
these disruptions is immense in my opinion. 

 

> Oil is there, but getting it out is going to become increasingly hard to do.

 

Yes but in general as technology improves we figure out how to do things that 
are harder and harder to do. Until just a few years ago getting light oil out 
of porous shale was so hard to do it just couldn't be done, but that is no 
longer true.

 

Yes, that is true to an extent. Another example, tertiary recovery techniques 
have given some life back to old depleted fields. But this can only work if 
there is an actual resource there to retrieve. But weighing against such 
improvements on the margin made possible through improved technology are a host 
of other factors including: 1) increasing marginal costs for critical supplies 
as the easiest, closest, most accessible sources are used up. An example of 
this is the rising marginal cost for poppants (certain grades of sand). 2) 
Increasing marginality of recovered resource. Tight oil is… well tight; it is 
hard dirty, difficult work, squeezing it out from that rock and doing so is 
only going to get harder as the quality of the next marginal field to be 
developed grows poorer over time (the better tracts being developed first)

 

 

> Tight oil will play a significant role in supplying liquid hydrocarbons to 
> the global market, but it is not the answer to all our energy woes.

 

It's not the long term solution but it could create trillions of dollars of 
wealth for the human race in the next decade or two, and that seems like 
something worth doing to me.The long term answer to our energy woes is liquid 
fueled Thorium nuclear reactors, and maybe fusion.   

 

When a boom goes bust, it is a while before the good times return. If investors 
get scorched in the tight oil patch, as it seems they might; it will not be all 
that easy to lure them back in. The trillions you speak of is the burn rate of 
this sector. And not just the tight oil sector, but the deep water drilling 
sector as well. Both have huge capital requirements. They are voracious money 
pits. Horizontal drilling and fracking is a big operation that sucks down a lot 
of up fr

Re: Natural gas: The fracking fallacy

[John Clark]

On Sat, Dec 27, 2014  'Chris de Morsella' via Everything List <
everything-list@googlegroups.com> wrote:

> A lot of the bets made in the US shale boom are not going to pay off for
> the investors holding on to the debt; holding those one or two year
> duration futures hedge contracts priced at $90 a barrel. After all these
> investors get burned – or IMO more likely the US taxpayers get stuck with
> the bill bailing out the too big to fail banks that have bet heavily in
> this sector and are the major holders of these seriously underwater futures
> contracts


But if you're right and oil production falls then the price of oil will go
up; if oil is selling at $200 a barrel and I have a futures contract saying
that I can buy oil at $90 then far from being underwater my contract is
worth $110. But if oil is selling at $80 and I have a contract saying I can
buy it at $90 then it's underwater and worth nothing.

I should add that historically the higher the price of oil gets the more
money the oil companies make. The way oil companies would get burned is if
you're wrong and oil production continues to rise and thus the price of oil
continues to fall.



> > Oil is there, but getting it out is going to become increasingly hard to
> do.
>

Yes but in general as technology improves we figure out how to do things
that are harder and harder to do. Until just a few years ago getting light
oil out of porous shale was so hard to do it just couldn't be done, but
that is no longer true.


> > Tight oil will play a significant role in supplying liquid hydrocarbons
> to the global market, but it is not the answer to all our energy woes.


It's not the long term solution but it could create trillions of dollars of
wealth for the human race in the next decade or two, and that seems like
something worth doing to me.The long term answer to our energy woes is
liquid fueled Thorium nuclear reactors, and maybe fusion.


> >> Concerning kerogen oil shale, I haven't found any credible source that
>> says it would take more energy to get oil out of kerogen shale than you
>> could get out of it which would mean it would never be economical no matter
>> how high the price of oil went.
>
>

> I have seen the EROI figure of 2.5:1  -- e.g. it takes 2.5 times as much
> energy in as can be obtained from the produced product.
>

I don't believe that for one second. Well OK maybe if you include self
energy, the heat given off by the kerogen itself as it undergoes chemical
change, but if you're talking about external energy that you need to pit in
and if it was true (and it would be very easy to prove if it were) that
you'd always get less energy out than you put in then oil executives would
have had to have been brain damaged to have ever spent one dime on it. It
may be uneconomical to obtain oil from kerogen with oil selling for less
than $60, but I don't think it's a law of physics that it must always be
uneconomical.

> There is one specific scenario where this makes some sense. I described
> it in detail in my response to spudboy. Basically if the installed base of
> wind and solar – a lot of which is sited in the same general areas as these
> shale deposits – continues to exponentially grow, then at some point this
> installed base will produce a massive surge capacity that will create huge
> surpluses of electric energy


A solar powered Dyson sphere would be interesting but If in the future wind
and terrestrial solar are the best energy sources available then human
civilization is doomed.

  John K Clark




>
>

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RE: Natural gas: The fracking fallacy

['Chris de Morsella' via Everything List]

Our current global energy situation – with say a horizon of the next fifty 
years – is not ideal. There are no silver bullets; no easy answers. Every 
single choice we can choose is problematic in one way or another. 

Continuing our global reliance on fossil fuels is going to continue to become 
marginally more and more expensive producing diminishing returns for the same 
amount of effort. Getting the next barrel of oil is going to require ever 
increasing amounts of capital – leaving less and less capital to go around for 
all other human needs.

Take, for example the large deep water fields discovered off the coast of 
Brazil. These fields do contain some fairly large amounts of oil (they are 
estimated to contain 13B barrels of oil), but they are under 2.5 kilometers of 
water and another 3 of solid rock; then yet another 2 km or so of salt rock. 
Drilling them is at the very limit of what is technologically possible (the 
Deep water Horizon blowout is an example of what can go wrong with these very 
deep water developments). Petrobas is spending some $257 billion through 2017 
(that is a lot of capital) to develop these deepwater high pressure fields.

The tertiary recovery techniques such as steam (plus chemicals such as 
surficants)  injection etc. only work for a while to extract the marginal 
amounts of oil that won’t flow out from the wells drilled into these fields 
without employing these techniques. It is a short term means of squeezing out 
that extra margin of oil form an almost depleted resource. Tertiary recovery 
techniques do not however magically create new resources where there are none. 
Pumping CO2 down into  gas and oil deposits also helps squeeze out the last 
dregs of petroleum, but it is not a new source. So it may help at the margins, 
but it is not the solution.

Renewable energy generation also has its own problems – which I am sure someone 
like John would be most happy to point out. 

And nuclear power as well is not without its own issues…. Security, safety and 
waste management, not to mention capital costs, technical feasibility etc.

There are no easy answers for our worlds energy needs over the next fifty 
years. Every solution is fraught with problems, is horribly expensive and will 
require profound adaptations to the way we live.

-Chris

 

 

From: everything-list@googlegroups.com 
[mailto:everything-list@googlegroups.com] 
Sent: Saturday, December 27, 2014 12:48 PM
To: everything-list@googlegroups.com
Subject: Re: Natural gas: The fracking fallacy

 

Unless there is a technology improvement, the kerogen might stay locked up 
perpetually, because of the cost of water in the parched western US, and the 
total costs of remediation of the mad and so forth. There can be developments 
that make any technology plausible to market. Just look at shale gas. But maybe 
a boost in the cost/price ratio, for solar may make it the energy of choice? 
Even Amory Lovins, writes in this manner, the manner of money. Having said 
this, the article by Weekly Standard seemed to make sense, even though it isn't 
what we really want. Enhanced Oil Recovery, turns every exhausted oil well on 
earth, into  a new fuel source. The magic trick into doing this, is capturing 
carbon and injecting it back into old wells. The air stays cleaner and we have 
affordable fuel, but it ain't a world powered by sunlight. The technology has 
been known for years, as 3D printing was, but small innovations made it 
profitable and workable. Injecting supercritical fluids, specifically 
supercritical CO2 would probably loosen up all that Kerogen, in the west and in 
the Appalachians. Unless someone makes sunlight work for us all, on a daily 
basis, we are stuck with fossil fuels. On the other hand it is shaking up the 
OPEC crowd.  

 

 

-Original Message-
From: 'Chris de Morsella' via Everything List 
To: everything-list 
Sent: Sat, Dec 27, 2014 3:07 pm
Subject: RE: Natural gas: The fracking fallacy

 

 

From: everything-list@googlegroups.com [mailto:everything-list@googlegroups.com 
<mailto:everything-list@googlegroups.com?> ] 
Sent: Saturday, December 27, 2014 4:42 AM
To: everything-list@googlegroups.com
Subject: Re: Natural gas: The fracking fallacy

 

Understood, but whether its the Huffington Post or the Standard, my question 
is, is it true? 

 

FYI – IMO, the Huffington Post, is looking more and more like a supermarket 
tabloid – and on its “serious” content on occasion I find it’s “liberal” slant 
to be insulting of my intelligence. In other words I don’t read the Huffington 
Post (and if while surfing I hit an article from them usually I will just surf 
on)

The tight oil play has been hugely over sold… IMO, based on the sources of 
information I have access to -- I am plugged in to active energy lists on which 
there are researchers who are looking at this very closely and who are very 
knowledgeable of the technology, geology, and the statistical analy

RE: Natural gas: The fracking fallacy

['Chris de Morsella' via Everything List]

 

 

From: everything-list@googlegroups.com 
[mailto:everything-list@googlegroups.com] On Behalf Of John Clark

 

On Fri, Dec 26, 2014 PM, 'Chris de Morsella' via Everything List 
 wrote:

 

OK Chris, you made some valid points and you've convinced me that I wasn't 
paying enough care in distinguishing between the very common kerogen oil shale 
that would need considerable processing to be useful and the less common shale 
oil (that is really just porous shale that contains light oil and gas in it ) 
which would need much less processing. And I concede that the bulk of the 
massive increase in oil and gas production in the USA came from this rarer 
porous shale rather than the much more common kerogen oil shale. 

 

Thank you for conceding this point; it displays intellectual maturity on your 
part. This is fairly arcane knowledge – not that many people are familiar with 
the critical difference between the kerogen bearing deposits and the porous 
tight oil bearing shale formations. Boosters of Kerogen bearing shale deposits, 
will naturally attempt to associate their resource with the tight oil shale and 
present it as if it was just an extension of the former. It is not, of course, 
but it is entirely understandable why the holders of these deposits would try 
to get it all lumped in together in one big bucket.

 

But just because it's rarer doesn't necessarily mean it's rare; when will the 
USA run out of shale oil and shale gas? 

 

No it is not rare; though how much of it there is that is economically 
recoverable (at any given price floor) is open for debate. I am more of a 
pessimist on this. 

What I think has happened is that the drillers have been very successful with 
the huge influx of capital they enjoyed (over the last five years boom time) in 
finding the best producing areas. We are enjoying the sweet spot side of the 
tight oil era. 

IMO – it will keep getting harder. Oil is there, but getting it out is going to 
become increasingly hard to do. Depletions rates will continue to rise (and for 
tight oil they are already very high and this is the reason the major oil 
companies have been abandoning the sector). 

In addition the world has only so much ability to allocate capital. Capital is 
a limited resource and as the capital needs continue to rise in order to 
produce a given amount of oil there is some limit to how far this can go.

It is not so much that it will run out. It is going to become increasingly 
expensive to produce.

What I think is going to happen – is that over the next five years a sober 
evaluation of the American shale boom will happen (as the data picture becomes 
clear). The amount of capital expenditure for producing a given quantity of 
tight oil will also become clear. A lot of the bets made in the US shale boom 
are not going to pay off for the investors holding on to the debt; holding 
those one or two year duration futures hedge contracts priced at $90 a barrel. 

After all these investors get burned – or IMO more likely the US taxpayers get 
stuck with the bill, bailing out the too big to fail banks that have bet 
heavily in this sector and are the major holders of these seriously underwater 
futures contracts – I do not believe the investment climate will be as friendly 
for this sector. New capital will be much harder to come by and each single 
case is going to get evaluated in a much more rigorous fashion, which is what 
should have been done this time around.

Tight oil will play a significant role in supplying liquid hydrocarbons to the 
global market, but it is not the answer to all our energy woes. Tight oil is 
grungy hard work and the margins will be slim.

What we are seeing now globally in this sector is a capital flight out of it. 
Eventually, after the capital markets work through the hangover from the 
current bubble getting blown out of the water by the global price slide --- 
those future contracts are going to really bite the banks big time – it is my 
opinion that capital will return to this sector and that new fields will be 
developed. 

One must also keep in mind other gating factors on the rate at which a resource 
can be exploited. For example the Canadian tar sand are huge, but the rate at 
which they can be exploited is gated by available processing water and energy 
(the sands need to be cooked).  Because of these other resource bottlenecks  
the rate at which these resources can be exploited is already being approached.

To give you an example from the Bakken – it is getting harder and harder for 
drillers to get good supplies of the sand they require for poppants (injected 
into the micro-fissures created by the fracking process to keep these 
micro-fissures open after the ultra-high pressure fracking fluid has been 
drained out.) They are having to haul sand from further and further afield; 
sand weighs a lot so hauling it over large distances significantly increases 
its costs. 

The principle gating factor is water. Water

Re: Natural gas: The fracking fallacy

[spudboy100 via Everything List]

Unless there is a technology improvement, the kerogen might stay locked up 
perpetually, because of the cost of water in the parched western US, and the 
total costs of remediation of the mad and so forth. There can be developments 
that make any technology plausible to market. Just look at shale gas. But maybe 
a boost in the cost/price ratio, for solar may make it the energy of choice? 
Even Amory Lovins, writes in this manner, the manner of money. Having said 
this, the article by Weekly Standard seemed to make sense, even though it isn't 
what we really want. Enhanced Oil Recovery, turns every exhausted oil well on 
earth, into  a new fuel source. The magic trick into doing this, is capturing 
carbon and injecting it back into old wells. The air stays cleaner and we have 
affordable fuel, but it ain't a world powered by sunlight. The technology has 
been known for years, as 3D printing was, but small innovations made it 
profitable and workable. Injecting supercritical fluids, specifically 
supercritical CO2 would probably loosen up all that Kerogen, in the west and in 
the Appalachians. Unless someone makes sunlight work for us all, on a daily 
basis, we are stuck with fossil fuels. On the other hand it is shaking up the 
OPEC crowd.  
 
 
-Original Message-
From: 'Chris de Morsella' via Everything List 
To: everything-list 
Sent: Sat, Dec 27, 2014 3:07 pm
Subject: RE: Natural gas: The fracking fallacy



 
 
From: everything-list@googlegroups.com 
[mailto:everything-list@googlegroups.com] 
Sent: Saturday, December 27, 2014 4:42 AM
To: everything-list@googlegroups.com
Subject: Re: Natural gas: The fracking fallacy
 
Understood, but whether its the Huffington Post or the Standard, my question 
is, is it true? 
 
FYI – IMO, the Huffington Post, is looking more and more like a supermarket 
tabloid – and on its “serious” content on occasion I find it’s “liberal” slant 
to be insulting of my intelligence. In other words I don’t read the Huffington 
Post (and if while surfing I hit an article from them usually I will just surf 
on)
The tight oil play has been hugely over sold… IMO, based on the sources of 
information I have access to -- I am plugged in to active energy lists on which 
there are researchers who are looking at this very closely and who are very 
knowledgeable of the technology, geology, and the statistical analysis of 
weekly/monthly raw wellhead data. 
It is not that there is not tight oil there – obviously there is. A lot of it 
in fact. The tight oil sector has in fact masked the (well measured) global 
peak in conventional oil production that occurred some years back. So there is 
a lot of tight oil being pumped from the Bakken and the Eagle Ford.
I am not denying the OBVIOUS!
What I take issue with is the unfounded hyper optimistic assumptions which the 
shale sector boosters make and that are then re-packaged as facts and sold to a 
gullible public in order to create a boom mentality and a gold rush flood of 
capital. This is fact what happened. The whole story has been pumped up and 
overblown.
There is oil trapped in the shale rock, but how much?
The current boom is driven by the drillers having drilled in these large oil 
bearing shale formations sweet spots – and why wouldn’t they; they are smart 
business men who know the business of drilling; they know geology and they know 
how to find oil. 
The EIA and the IEA reserve projections take no account of the micro-geology 
that characterizes these formations and make the unfounded assumption that the 
entire mass of these formations will produce at the same or similar rates as 
these sweet spots have. Based on what evidence? 
Furthermore, by far most of the shale resources sited by boosters of shale and 
the faithful believers in Cornucopeanism like John Clark (who amusingly claims 
not to be religious) ARE NOT RECOVERABLE in a manner that is feasible both 
economically and energetically. I have clearly documented this and WHY. Kerogen 
bearing deposits are very different from oil bearing shale formations. Oil 
bearing shale formations, such as the Bakken or the Eagle Ford can be slant 
drilled then hydraulically fractured to produce oil. The oil is present in 
these formations (mostly in sweet spots), but trapped in the shale matrix. Once 
fracked (plus all those chemicals pumped down there to help make it flow out) 
it can be pumped out form the formation and up to the well head.
Kerogen is NOT oil! Kerogen bearing shale is ROCK! The rock itself needs to be 
cooked at a process temperature of 350 degrees C for an hour in order to cook 
out oil from the wax-like kerogen. For a hundred years now, at various times 
people have tried to produce oil from this massive resource (the first kerogen 
bubble was way back in 1915). Every attempt has failed! Most recently with 
Shell Oil abandoning it’s R&D facility in the Colorado. In 1982 Exxon/Mobile 
threw in the towel after dumping $5 billion and the D

RE: Natural gas: The fracking fallacy

['Chris de Morsella' via Everything List]

 

 

From: everything-list@googlegroups.com 
[mailto:everything-list@googlegroups.com] 
Sent: Saturday, December 27, 2014 4:42 AM
To: everything-list@googlegroups.com
Subject: Re: Natural gas: The fracking fallacy

 

Understood, but whether its the Huffington Post or the Standard, my question 
is, is it true? 

 

FYI – IMO, the Huffington Post, is looking more and more like a supermarket 
tabloid – and on its “serious” content on occasion I find it’s “liberal” slant 
to be insulting of my intelligence. In other words I don’t read the Huffington 
Post (and if while surfing I hit an article from them usually I will just surf 
on)

The tight oil play has been hugely over sold… IMO, based on the sources of 
information I have access to -- I am plugged in to active energy lists on which 
there are researchers who are looking at this very closely and who are very 
knowledgeable of the technology, geology, and the statistical analysis of 
weekly/monthly raw wellhead data. 

It is not that there is not tight oil there – obviously there is. A lot of it 
in fact. The tight oil sector has in fact masked the (well measured) global 
peak in conventional oil production that occurred some years back. So there is 
a lot of tight oil being pumped from the Bakken and the Eagle Ford.

I am not denying the OBVIOUS!

What I take issue with is the unfounded hyper optimistic assumptions which the 
shale sector boosters make and that are then re-packaged as facts and sold to a 
gullible public in order to create a boom mentality and a gold rush flood of 
capital. This is fact what happened. The whole story has been pumped up and 
overblown.

There is oil trapped in the shale rock, but how much?

The current boom is driven by the drillers having drilled in these large oil 
bearing shale formations sweet spots – and why wouldn’t they; they are smart 
business men who know the business of drilling; they know geology and they know 
how to find oil. 

The EIA and the IEA reserve projections take no account of the micro-geology 
that characterizes these formations and make the unfounded assumption that the 
entire mass of these formations will produce at the same or similar rates as 
these sweet spots have. Based on what evidence? 

Furthermore, by far most of the shale resources sited by boosters of shale and 
the faithful believers in Cornucopeanism like John Clark (who amusingly claims 
not to be religious) ARE NOT RECOVERABLE in a manner that is feasible both 
economically and energetically. I have clearly documented this and WHY. Kerogen 
bearing deposits are very different from oil bearing shale formations. Oil 
bearing shale formations, such as the Bakken or the Eagle Ford can be slant 
drilled then hydraulically fractured to produce oil. The oil is present in 
these formations (mostly in sweet spots), but trapped in the shale matrix. Once 
fracked (plus all those chemicals pumped down there to help make it flow out) 
it can be pumped out form the formation and up to the well head.

Kerogen is NOT oil! Kerogen bearing shale is ROCK! The rock itself needs to be 
cooked at a process temperature of 350 degrees C for an hour in order to cook 
out oil from the wax-like kerogen. For a hundred years now, at various times 
people have tried to produce oil from this massive resource (the first kerogen 
bubble was way back in 1915). Every attempt has failed! Most recently with 
Shell Oil abandoning it’s R&D facility in the Colorado. In 1982 Exxon/Mobile 
threw in the towel after dumping $5 billion and the DOE dumped $10 billion in 
futile attempts to economically produce oil from kerogen.

The only way these kerogen deposits will ever be exploited to any degree 
whatsoever is if wind and solar generation capacity becomes so extensive that 
their surge over-capacity can be used to electrically cook the oil out of the 
kerogen at a energy loss of 1:2.5. Losing huge amounts of energy in the 
process, but – and this is key – it would be negative value electricity from 
wind & solar electric surplus generation that has no matching demand (when the 
wind is blowing in the middle of the night for example) and exceeds the rate at 
which any storage facilities can absorb it. In this very specific scenario 
these temporary surges of surplus power could be used to help extract a 
valuable liquid fuel – in spite of the fact that a lot more energy is going in 
to the process than is being extracted out of the process.

When I hear people – like John Clark – present the Green River Formation (a 
very large kerogen bearing shale formation) claiming that it should be counted 
as a reserve, well that is when I feel the need to disabuse these folks of 
their illusions/delusions. 

It is a fact by far most people do not get the crucial critical difference 
between tight oil bearing shale deposits and kerogen bearing shale deposits and 
they naively treat these as being similar, calling them all, generically, shale 
deposits. 

That is wron

Re: Natural gas: The fracking fallacy

[John Clark]

On Fri, Dec 26, 2014 PM, 'Chris de Morsella' via Everything List <
everything-list@googlegroups.com> wrote:

OK Chris, you made some valid points and you've convinced me that I wasn't
paying enough care in distinguishing between the very common kerogen oil
shale that would need considerable processing to be useful and the less
common shale oil (that is really just porous shale that contains light oil
and gas in it ) which would need much less processing. And I concede that
the bulk of the massive increase in oil and gas production in the USA came
from this rarer porous shale rather than the much more common kerogen oil
shale. But just because it's rarer doesn't necessarily mean it's rare; when
will the USA run out of shale oil and shale gas? Estimates seem to be all
over the place, some say production in the USA  will plateau in about a
decade and start to decline shortly after that, others say that won't
happen for 30 years or more. I don't know who's right but even if the most
pessimistic is correct trillions of dollars will be pumped out of the
ground due to fracking. And lots of countries have far more shale oil (but
not kerogen oil shale) than the USA and they haven't even started fracking
yet.

Concerning kerogen oil shale, I haven't found any credible source that says
it would take more energy to get oil out of kerogen shale than you could
get out of it which would mean it would never be economical no matter how
high the price of oil went. What I've seen is that with existing technology
to make a barrel of oil from kerogen oil shale it would cost between $75
and $110, and that would explain why oil companies can't make any money off
it with oil selling for just $57. But even under the assumption that the
technology will not improve (a ridiculous assumption) oil shale should put
a lid on how high the price of oil can go.

And I don't even want to get into Methane Clathrate that contains more
energy than all forms of shale and tar sands combined,

  John K Clark

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Re: Natural gas: The fracking fallacy

[spudboy100 via Everything List]

Understood, but whether its the Huffington Post or the Standard, my question 
is, is it true? Yes, I assume at first pass, everything is propaganda. Then I 
will try to establish, through alternative searches whether there is an 
confirmation to a claim, independent confirmation. Hopefully, independent 
confirmation, that is. EOR may likely work. However, its not something that I 
am in love with. For years, I have wanted cities powered completely by solar, 
but this is not really panning out. It's like the old article, "Wheres my 
Flying Car Dude?" I have seen prototypes for decades, and they always look like 
small airplanes, even Moeller's. Tain't gonna happen apparently, so we do the 
best we can. 

I don’t look to the Weekly Standard for energy news or opinion  – or any news 
or opinion for that matter. Each to his or her taste I guess.




-Original Message-
From: 'Chris de Morsella' via Everything List 
To: everything-list 
Sent: Thu, Dec 25, 2014 6:28 pm
Subject: RE: Natural gas: The fracking fallacy



I don’t look to the Weekly Standard for energy news or opinion  – or any news 
or opinion for that matter. Each to his or her taste I guess.
 
From: everything-list@googlegroups.com 
[mailto:everything-list@googlegroups.com] 
Sent: Thursday, December 25, 2014 10:28 AM
To: everything-list@googlegroups.com
Subject: Re: Natural gas: The fracking fallacy
 


Sent from AOL Mobile Mail

 

In addition to not being the energy future we all wanted, here, to my mind, is 
the next likely step, by price, by technology, in energy. I don't completely 
trust the author, but his summary is thorough. The author links this source 
even, to co2 remmediation. In a way, its like having George Jetsons' flying 
fliver, powered by gasoline, rather then atoms or photons. The article also 
presages the shale gas revolution, to being something very long in the process 
(decades), to this source. Seeing how 98% of us were paying attention other 
things, it came as a surprise to the vast majority. This will as well.

 

http://m.weeklystandard.com/articles/next-shale-revolution_821866.html?page=3

 

From: 'Chris de Morsella' via Everything List 
To: everything-list 
Sent: Thu, Dec 25, 2014 01:37 AM
Subject: RE: Natural gas: The fracking fallacy




 
 
From: everything-list@googlegroups.com 
[mailto:everything-list@googlegroups.com] 
Sent: Wednesday, December 24, 2014 9:10 PM
To: everything-list@googlegroups.com
Subject: Re: Natural gas: The fracking fallacy
 


Sent from AOL Mobile Mail

 

It could be just as you suggest, a chemical, toxic, nightmare, to be footed by 
the tax payers. But I am thinking not so much, as the chemicals used have been 
around for decades, with no great problem detected. Notice how cheaper the 
gasoline is now? Notice how russia, iran, and the saudi economy has been 
upended? The idea is a civilization completely powered by the sun. The real is 
fracking. But we can always hope.
In energy matters I prefer to look at five year moving averages for 
understanding price trends; doing so helps eliminate the noise of volatility in 
the market. 
Most of the independent drilling companies that dominate US shale production 
sell futures contracts to show lenders they have locked in an oil price that is 
higher than their cost of production. This is especially true for the many 
independent smaller operators; if they can’t hedge above their cost of 
production, they are dead in the water. The US shale play needs a sustained 
minimum of above $90 on the world oil futures markets in order to be able to 
sell these hedges and use them as the basis on which they can get new capital 
to continue drilling.
There are trillions of dollars of future hedge contracts most of which were 
underwritten by big money center banks whose models did not account for this 
global market plunge. Big money center banks are feeling quite exposed now and 
if this price slump lasts longer than a year they could be in very serious 
trouble again, in a repeat of 2007-2008 when the housing derivatives market 
collapsed. Estimates put the six largest “too big to fail” banks commodity 
derivatives contracts holdings around $3.9 trillion, a majority of which is 
comprised of various flavors of oil future hedges. Most of the drillers in the 
tight oil sector in the US have already locked in future prices for next year 
and up into 2016 at around $90 per barrel. For example, Noble Energy and Devon 
Energy have both hedged over three-quarters of their output for 2015, and 
Pioneer Natural Resources has options covering 67% of its likely production 
through 2016. 
These drillers have locked in price volatility protection for themselves (as 
long as the banks honor their losses), but what about the big banks themselves? 
If global oil spot price stagnates for much longer and these contracts start 
coming due the losses are going to be astronomical. Who will endup covering 

RE: Natural gas: The fracking fallacy

['Chris de Morsella' via Everything List]

 

 

From: everything-list@googlegroups.com 
[mailto:everything-list@googlegroups.com] On Behalf Of John Clark

 

On Thu, Dec 25, 2014  'Chris de Morsella' via Everything List 
 wrote:

 

 > DO you even know what the term “tight oil” means technically?

 

Yes. Tight oil is just another name for shale oil, it's light oil in kerogen 
rich shale deposits that needs hydraulic fracking to be extracted economically. 
 There is a enormous amount of tight oil in the Earth but until just a few 
years ago it might as well have been on the moon for all the good it did us, 
but things change and sometimes very very rapidly. Technology marches on. 

 

> Kerogen IS NOT OIL!


But when heated to about 150 degrees centigrade in the absence of oxygen 
kerogen releases crude oil, and when heated to 200 degrees it releases natural 
gas. 

The process temperatures you quote are far lower than those I have seen in the 
studies I have looked at. In those reference studies they speak of the need to 
slow cook the kerogen at process temperatures of 350 degrees C cooking out most 
of the oil in about an hour.

But even – for the sake of discussion – accepting you low ball numbers -- pray 
tell me the energy requirements to heat the billions upon billions of metric 
tons of a kerogen bearing shale formation up to 150 degrees centigrade or 
whatever the actual (significantly higher) process temperature needs to be? 

>  Kerogen bearing shale is a very different kind of resource


Huh? Very different from what?

>From oil. You can make oil from coal – does that mean we start calling coal 
>oil? In the same manner Kerogen IS NOT oil. It needs to be cooked – as I 
>previously pointed out – in earlier posts on this thread (and you probably did 
>not read). Kerogen is a tar-like hydrocarbon (the remnants of ancient algae) 
>embedded in solid sedimentary shale rock. Kerogen is inside the rock itself, 
>it is not a liquid trapped in micro-pores. You can try to insist they are the 
>same as long as you want, and I will continue to call you on this false 
>assumption.

>  that has proven uneconomical 


>>And yet this "uneconomical" resource has caused the oil production of the USA 
>>to skyrocket. 

Again you are bullshitting John, by mixing apples and oranges. In fact, it is 
by drilling in the sweet spots in tight oil or gas bearing shale formations 
such as the Eagle Ford, the Bakken or the Marcellus that have produced the 
recent boom in production. 

This IS NOT kerogen bearing shale! 

Kerogen bearing shale is a very different resource that poses much greater 
energetic and technical challenges and has so far defeated all attempts to 
produce it (ECONOMICALLY)

And in July 2008, well before this "uneconomical" process was implemented, the 
worldwide price of West Texas Intermediate Crude oil was $147 a barrel, but 
today on December 25  2014  West Texas Intermediate crude oil is selling at $56 
a barrel. I don't think the word "uneconomical" means what you think it does.

I don’t think you know what you are talking about – because you keep lumping 
the kerogen bearing shale deposits in with the very much smaller tight oil 
bearing shale deposits and pretending that they are essentially the same thing 
WHEN THEY ARE NOT!

> Shell Oil has just recently abandoned its kerogen extraction attempts


For christ's sake, if you're wildcatting for conventional oil or shale oil 
you're always going to run into dry holes from time to time, it's part of the 
price of doing business. So back in 2013 Shell oil announced they were 
abandoning one minuscule 30 million (that's million with a m) dollar shale oil 
pilot project. Big deal. On the very same day they said there were going to 
build a HUGE 12.5 billion dollar plant (that's billion with a B) in Louisiana 
to turn natural gas into diesel and jet fuel 

 

A big so what to your transparent attempt at misdirection? What bearing does a 
natural gas conversion plant have on kerogen extraction? None John. It is an 
unrelated energy factoid you throw in to confuse the issue. There is no large 
scale attempt to extract oil from kerogen bearing shale deposits. Shell Oil 
just abandoned its experimental plant in western Colorado. 

Even though Shell Oil has been guarded about releasing its EROI figures for its 
kerogen extraction pilot plant, I am seeing figures around 2.5:1, which is 
another way of saying that Shell Oil – after years of tweaking its process and 
trying to maximize its efficiency – discovered they needed something in the 
order of two and a half times as much energy to cook the oil out of their pilot 
project kerogen bearing shale than they could recover from the extracted liquid.

You don’t like these facts John – they don’t support your cornucopean argument 
– so you ignore the actual project – that was shut down and that WAS ATTEMPTING 
to extract oil from kerogen by announcing an utterly unrelated energy 
investment made by the Shell Oil company.

 

> > And as I've said exis

Re: Natural gas: The fracking fallacy

[zibblequibble]

On Tuesday, December 23, 2014 9:12:09 PM UTC, John Clark wrote:
>
> On Mon, Dec 22, 2014 'Chris de Morsella' via Everything List <
> everyth...@googlegroups.com > wrote:
>
> >> In the USA oil production rose by more than half a million barrels per 
>>> day between 2007 and 2011 to the highest level in 15 years, and in that 
>>> same year the USA exported more gasoline and diesel than it imported for 
>>> the first time since 1949. And in 2012 USA oil production increased by 
>>> another 760,000 barrels a day, the largest yearly increase since records 
>>> about oil production started in 1859. But incredibly 2013 beat even that 
>>> record, oil production in the United States rose by another 992,000 barrels 
>>> a day! And in 2014 the USA overtook Saudi Arabia to become the largest 
>>> producer of oil on planet Earth, it was already the largest natural gas 
>>> producer in the world and has been since 2010.
>>>
>>
>> > Yes, so what?
>>
>
> So the "false projections" about the USA becoming the next Saudi Arabia 
> turned out to be true.
>
> > I was under the mistaken impression that you understood what reserves 
>> mean,
>>
>
> And I was under the mistaken impression that you understood that 
> historically the proven oil reserves of a country have remained about as 
> constant as the New York Stock Exchange, it changes every time a new oil 
> discovery is made, and even more important, it changes  every time a new 
> technology is developed that allows for the economic extraction of oil in 
> places where it had previously been uneconomic.
>  
>
>> > Reserves measure what is in the ground that can be recovered.
>>
>
> Reserves measure what is known to be in the ground that can be recovered 
> economically with existing technology. 
>
> >> Explain to me how the Saudi's will make more cash when oil is selling 
>>> at $60 a barrel then it did when it was selling at $130 a barrel. Is this 
>>> some new form of mathematics?
>>>
>>
>> > Are you trying to be ironic or cute? Clearly the Saudi's feel they can 
>> endure the loss now in order to drive a large portion of the higher cost 
>> producers out of business.
>>
>
> So your theory is that the price of oil collapsed from $130 to $60 because 
> of some sort of byzantine conspiracy of the Saudi's, but your theory just 
> does not fit the facts. During the time of the oil collapse Saudi Arabia 
> did NOT increase their oil production, they kept on using the same old 
> technology and their production remained constant. However during that time 
> the USA  started using a new technology, and they increased their oil 
> production, and did so DRAMATICALLY. And the USA increased its gas 
> production even more. There is no need to invoke sinister plots by James 
> Bond style villains, it's a simple rule of economics that when the supply 
> of commodity X increases the price of commodity X falls.
>
> And the free market ensures that the sort of silly conspiracy you're so 
> concerned about could never work. I manufacture 99% of the worlds widgets, 
> you make 1%. I want to drive you out of business, so I figure I'll lower my 
> price until you go broke and then I can jack them up to anything I want. So 
> now you lose money on each
> widget you sell, the trouble is I do too. I have 99 times as much money as 
> you do, but I'm losing it 99 times faster. Even worse, because the price is 
> very low the demand for widgets is huge, and if prices are to remain low I 
> must build more factories (or oil wells) and increase production. I'm 
> losing money faster and faster,
> meanwhile you just temporally halt production in your small factory and 
> wait for me to go broke. It won't be a long wait.
>  
>  John K Clark
>
 
Before I issue...this...perhaps unnoteworthy semi-intoxicated response to 
the untrained eye. While to others more seasoned, a reply of momentus 
historic import. How you read and judge it...is known only to theethy 
training be in the dock here, no less, for what thee say. And ne'er the 
writer me. 

Well anyway, if you must know what I was going to say, it was this: Yes sir 
Chris is one of those left wing creatures of the night. A man should keep 
his mouth zipped and wear short trousers until he has made his first 
million. I should say. Hear here. Wot. 

And you are Johnny Boy. All American kid. Made a fortune in the biotech 
seed capital business angel's industry. Made a mint my johnny boy oh baby 
yeah. The drove his way across the USA. On  a Harley D they say. Some say 
Tom Petty wrote this song for Johnny Boy 
https://www.youtube.com/watch?v=nUTXb-ga1fo

But I digress. 

With all the above said, and a very loving sycophantic 'I Love You' kiss 
blown...and a merry xmas to you and yours...

Yes with all that in place. I was just going to say the Free Market doesn't 
guarantee anything what you say except in special conditions. 

Those special conditions existed in times and places in the past. Free 
market ideology hacks tend to draw on th

Re: Natural gas: The fracking fallacy

[John Clark]

On Thu, Dec 25, 2014  'Chris de Morsella' via Everything List <
everything-list@googlegroups.com> wrote:

 > DO you even know what the term “tight oil” means technically?
>

Yes. Tight oil is just another name for shale oil, it's light oil in
kerogen rich shale deposits that needs hydraulic fracking to be extracted
economically.  There is a enormous amount of tight oil in the Earth but
until just a few years ago it might as well have been on the moon for all
the good it did us, but things change and sometimes very very rapidly.
Technology marches on.

> Kerogen IS NOT OIL!


But when heated to about 150 degrees centigrade in the absence of oxygen
kerogen releases crude oil, and when heated to 200 degrees it releases
natural gas.

>  Kerogen bearing shale is a very different kind of resource


Huh? Very different from what?

>  that has proven uneconomical


And yet this "uneconomical" resource has caused the oil production of the
USA to skyrocket. And in July 2008, well before this "uneconomical" process
was implemented, the worldwide price of West Texas Intermediate Crude oil
was $147 a barrel, but today on December 25  2014  West Texas Intermediate
crude oil is selling at $56 a barrel. I don't think the word "uneconomical"
means what you think it does.

> Shell Oil has just recently abandoned its kerogen extraction attempts


For christ's sake, if you're wildcatting for conventional oil or shale oil
you're always going to run into dry holes from time to time, it's part of
the price of doing business. So back in 2013 Shell oil announced they were
abandoning one minuscule 30 million (that's million with a m) dollar shale
oil pilot project. Big deal. On the very same day they said there were
going to build a HUGE 12.5 billion dollar plant (that's billion with a B)
in Louisiana to turn natural gas into diesel and jet fuel

> > And as I've said existing technology can only exploit about 25% of it,
> but that's more than enough to change the economy of the world.
>


> I bet you just pulled that 25% figure out of your ass John.


Then I guess I have a well educated ass because the Paris based IEA says
there are 3.7 trillion barrels of shale oil in the USA but only 1 trillion
can be economically recovered with existing technology. You do the
arithmetic.

> The very EIA (and IEA) numbers you keep siting are under attack

They are under attack by you and by some environmentalists, but as I've
said before most environmentalists are not serious people, they are very
silly people. To make any difference in your lifetime the numbers would
have to be off by at least a order of magnitude, and the energy Department
doesn't think they are, nor Paris based IEA, nor any reputable professional
organization of geologists.

> There is no informed consensus – outside of shale oil boosterism circles
> – about the fact that by far most of these resources ARE NOT reserves.
> [...] Just because the EIA and IEA (both captive organizations staffed by a
> revolving door system with insider vested fossil and nuclear interests) say
> something does not make it the word of God!
>

And it looks like even Wikipedia is part of this evil conspiracy of
disinformation lies and mendacity because it says: "Global technically
recoverable oil shale reserves have recently been estimated at about 2.8 to
3.3 trillion barrels (450×109 to 520×109 m3) of shale oil, with the largest
reserves in the United States, which is thought to have 1.5–2.6 trillion
barrels (240×109–410×109 m3)"

http://en.wikipedia.org/wiki/Shale_oil#Reserves_and_production

In that same article it says: "In March 2011, the United States Bureau of
Land Management called into question proposals in the U.S. for commercial
operations, stating that "*There are no economically viable ways yet known
to extract and process oil shale for commercial purposes*"".  Also in March
2011 there is a article in Forbes magazine about economist Nouriel Roubini
who must have agreed with the United States Bureau of Land Management, and
a lot of oil traders must have agreed with them too:

http://www.forbes.com/sites/chrisbarth/2011/03/07/roubini-predicts-oil-will-hit-150-per-barrel-traders-betting-on-200/

The headline of the article is "*Roubini Predicts Oil Will Hit $150 Per
Barrel, Traders Betting On $200*" .  Remember that was March 2011,
yesterday December 25 2014 oil was selling at $56 a barrel.

> So go ahead keep calling me a tree hugger if that makes you feel better


OK.

> Nobody is disputing that the global spot price for oil has gone down;


And there must have been a reason for such a gargantuan economic event.
OPEC did not increase production but the USA increased oil production
enormously, do you think that maybe just maybe that had something to do
with it? And how did the USA increase production, it can't be shale because
you tell me the oil companies are abandoning it, and yet the USA somehow
managed to dramatically increase production. What's the secret?


> > you keep trumpeting it

RE: Natural gas: The fracking fallacy

['Chris de Morsella' via Everything List]

 

 

From: everything-list@googlegroups.com 
[mailto:everything-list@googlegroups.com] On Behalf Of John Clark
Sent: Thursday, December 25, 2014 8:59 AM
To: everything-list@googlegroups.com
Subject: Re: Natural gas: The fracking fallacy

 

On Thu, Dec 25, 2014 at 1:33 AM, 'Chris de Morsella' via Everything List 
 wrote:

 

>> I'm sorry Chris but that simply isn't true. Yes the Monterey shale reserve 
>> was vastly overestimated, at one time they thought it contained 15.4 billion 
>> barrels of oil but the true figure is less than a billion. However just one 
>> oil shale deposit in the USA, the Green River Formation, contains 1466 
>> billion barrels of oil, nearly 100 times what Monterey was thought to 
>> contain even at it's peak. So although embarrassing the overestimate doesn't 
>> substantially change anything. 


> Yeah… and if you believe those figures I have a bridge to sell you in 
> Brooklyn. In fact those very numbers you site are controversial and disputed 
> by many petroleum geologists.

 

What the hell are you talking about? There may be controversy over what should 
be done with shale oil but there is scientific consensus over approximately how 
much shale oil is on the planet and that most of it is in the USA. 

 

Incorrect there is not scientific consensus.. whatever this phrase actually 
means in this context, on this matter. I have clued you in to the core of the 
on-going debate about the planets shale resources. There is no informed 
consensus – outside of shale oil boosterism circles – about the fact that by 
far most of these resources ARE NOT reserves.

They cannot be exploited in a manner that yields a positive EROI let alone a 
decent return on capital expenditures.

As I said already there is a lot of gold dissolved in the world’s oceans… much 
more than all the gold in all the reserves. It is a resource, but that 
dissolved gold is not a reserve. A similar argument exists for the vast 
majority of kerogen bearing shale. It may be a resource, but it is not a 
reserve.

Yet you keep counting it as a reserve and making noises about some “scientific 
consensus” existing. Just because the EIA and IEA (both captive organizations 
staffed by a revolving door system with insider vested fossil and nuclear 
interests) say something does not make it the word of God! In fact as I have 
pointed out they have got it terribly wrong in the past and in a big way.


 

> Just because it is shale does not mean that the hydrocarbons trapped in it 
> are recoverable. 

 

And that is why geologists say that there are 4.8 trillion barrels of shale oil 
in the world with 3.7 trillion barrels of it being in the USA but only 1 
trillion can be economically recovered with existing technology. 

 

Keep reiterating discredited numbers – repating them over an dover when I have 
in a detailed fashion given you the reasons why those kerogen bearing shale 
resources ARE not reserves; in the sense they are not recoverable in a manner 
that gives a net energy return. The kerogen needs to be cooked in order to 
yield oil; cooking such a vast mass of shale – either mined and crushed or by 
trying to frack it and cook it by pumping heat into the kerogen bearing 
formation – it takes a huge amount of energy. More energy than one can get by 
burning the marginal volumes of extracted kerogen. If it is so easy to extract 
it with existing technology  then pray tell me why has everyone who has 
seriously tried, including Shell Oils many decades long attempts in the Green 
River shale formation you keep siting. Why have they all failed? Why has Shell 
Oil abandoned its efforts after dumping so many millions in attempts to squeee 
a profit out of that rock?

Unless you can answer these questions your 1 Trillion recoverable number is 
pure unadulterated bullshit! It stinks like the spun PR it is.

 

 

 > This oil is properly called "tight oil", 

 

And until about 5 years ago almost 100% of shale oil was tight oil, but 
technology marches on and today only about 75% is tight oil, and just that 25% 
is enough to cause a historic drop in oil prices that will dramatically change 
geopolitics.  

You are not making any fucking sense at all. What the hell are you speaking 
about? DO you even know what the term “tight oil” means technically? It has a 
very specific meaning, which seems to have slipped right past you. Tight oil is 
actual oil that is in tight deposits in shale formations for example. But it IS 
oil and it will flow like oil. 

Kerogen IS NOT OIL!

Kerogen bearing shale is a very different kind of resource that has proven 
uneconomical and has resisted every effort to try to produce a return on. Shell 
Oil has just recently abandoned its kerogen extraction attempts. Try to 
understand the implications of this. A major oil company, after decades of 
trying and millions and millions of dollars spent has re

RE: Natural gas: The fracking fallacy

['Chris de Morsella' via Everything List]

I don’t look to the Weekly Standard for energy news or opinion  – or any news 
or opinion for that matter. Each to his or her taste I guess.

 

From: everything-list@googlegroups.com 
[mailto:everything-list@googlegroups.com] 
Sent: Thursday, December 25, 2014 10:28 AM
To: everything-list@googlegroups.com
Subject: Re: Natural gas: The fracking fallacy

 



Sent from AOL Mobile Mail

 

In addition to not being the energy future we all wanted, here, to my mind, is 
the next likely step, by price, by technology, in energy. I don't completely 
trust the author, but his summary is thorough. The author links this source 
even, to co2 remmediation. In a way, its like having George Jetsons' flying 
fliver, powered by gasoline, rather then atoms or photons. The article also 
presages the shale gas revolution, to being something very long in the process 
(decades), to this source. Seeing how 98% of us were paying attention other 
things, it came as a surprise to the vast majority. This will as well.

 

http://m.weeklystandard.com/articles/next-shale-revolution_821866.html?page=3

 

From: 'Chris de Morsella' via Everything List 
To: everything-list 
Sent: Thu, Dec 25, 2014 01:37 AM
Subject: RE: Natural gas: The fracking fallacy



 

 

From: everything-list@googlegroups.com [mailto:everything-list@googlegroups.com 
<mailto:everything-list@googlegroups.com?> ] 
Sent: Wednesday, December 24, 2014 9:10 PM
To: everything-list@googlegroups.com
Subject: Re: Natural gas: The fracking fallacy

 



Sent from AOL Mobile Mail

 

It could be just as you suggest, a chemical, toxic, nightmare, to be footed by 
the tax payers. But I am thinking not so much, as the chemicals used have been 
around for decades, with no great problem detected. Notice how cheaper the 
gasoline is now? Notice how russia, iran, and the saudi economy has been 
upended? The idea is a civilization completely powered by the sun. The real is 
fracking. But we can always hope.

In energy matters I prefer to look at five year moving averages for 
understanding price trends; doing so helps eliminate the noise of volatility in 
the market. 

Most of the independent drilling companies that dominate US shale production 
sell futures contracts to show lenders they have locked in an oil price that is 
higher than their cost of production. This is especially true for the many 
independent smaller operators; if they can’t hedge above their cost of 
production, they are dead in the water. The US shale play needs a sustained 
minimum of above $90 on the world oil futures markets in order to be able to 
sell these hedges and use them as the basis on which they can get new capital 
to continue drilling.

There are trillions of dollars of future hedge contracts most of which were 
underwritten by big money center banks whose models did not account for this 
global market plunge. Big money center banks are feeling quite exposed now and 
if this price slump lasts longer than a year they could be in very serious 
trouble again, in a repeat of 2007-2008 when the housing derivatives market 
collapsed. Estimates put the six largest “too big to fail” banks commodity 
derivatives contracts holdings around $3.9 trillion, a majority of which is 
comprised of various flavors of oil future hedges. Most of the drillers in the 
tight oil sector in the US have already locked in future prices for next year 
and up into 2016 at around $90 per barrel. For example, Noble Energy and Devon 
Energy have both hedged over three-quarters of their output for 2015, and 
Pioneer Natural Resources has options covering 67% of its likely production 
through 2016. 

These drillers have locked in price volatility protection for themselves (as 
long as the banks honor their losses), but what about the big banks themselves? 
If global oil spot price stagnates for much longer and these contracts start 
coming due the losses are going to be astronomical. Who will endup covering 
these losses? 

Interesting side note: Harold Hamm, the Oklahoma oil billionaire (heavily 
invested in the Bakken) has bet a big chunk of his fortune that oil prices will 
rise soon; cashing in on almost 40 million barrels worth of future hedges, 
reaping a current profit of over $433 million for this quarter, but exposing 
his firm to price volatility if oil spot prices should stagnate or even decline 
further. 

-Chris

 




-Original Message-
From: 'Chris de Morsella' via Everything List 
To: everything-list 
Sent: Wed, Dec 24, 2014 03:31 PM
Subject: Re: Natural gas: The fracking fallacy

 

  _  

From: spudboy100 via Everything List 
To: everything-list@googlegroups.com 
Sent: Wednesday, December 24, 2014 12:22 PM
Subject: Re: Natural gas: The fracking fallacy

 

>>It could be a bubble but its not. Nothing has paid off like shale gas. 
>>Nothing else in the world has paid off like this.  

 

Wait till the taxpayer gets dumped on with all those underwater d

Re: Natural gas: The fracking fallacy

[spudboy100 via Everything List]

Sent from AOL Mobile Mail

In addition to not being the energy future we all wanted, here, to my mind, is 
the next likely step, by price, by technology, in energy. I don't completely 
trust the author, but his summary is thorough. The author links this source 
even, to co2 remmediation. In a way, its like having George Jetsons' flying 
fliver, powered by gasoline, rather then atoms or photons. The article also 
presages the shale gas revolution, to being something very long in the process 
(decades), to this source. Seeing how 98% of us were paying attention other 
things, it came as a surprise to the vast majority. This will as well.

http://m.weeklystandard.com/articles/next-shale-revolution_821866.html?page=3


From: 'Chris de Morsella' via Everything List 
To: everything-list 
Sent: Thu, Dec 25, 2014 01:37 AM
Subject: RE: Natural gas: The fracking fallacy




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  From: mailto:everything-list@googlegroups.com";>everything-list@googlegroups.com
 [mailto:everything-list@googlegroups.com?";>mailto:everything-list@googlegroups.com]
 
Sent: Wednesday, December 24, 2014 9:10 PM
To: mailto:everything-list@googlegroups.com";>everything-list@googlegroups.com
Subject: Re: Natural gas: The fracking fallacy
   
  

Sent from AOL Mobile Mail
  

  
  

   It could be just 
as you suggest, a chemical, toxic, nightmare, to be footed by the tax payers. 
But I am thinking not so much, as the chemicals used have been around for 
decades, with no great problem detected. Notice how cheaper the gasoline is 
now? Notice how russia, iran, and the saudi economy has been upended? The idea 
is a civilization completely powered by the sun. The real is fracking. But we 
can always hope.
   In 
energy matters I prefer to look at five year moving averages for understanding 
price trends; doing so helps eliminate the noise of volatility in the market. 

   Most 
of the independent drilling companies that dominate US shale production sell 
futures contracts to show lenders they have locked in an oil price that is 
higher than their cost of production. This is especially true for the many 
independent smaller operators; if they can’t hedge above their cost of 
production, they are dead in the water. The US shale play needs a sustained 
minimum of above $90 on the world oil futures markets in order to be able to 
sell these hedges and use them as the basis on which they can get new capital 
to continue drilling.
   There 
are trillions of dollars of future hedge contracts most of which were 
underwritten by big money center banks whose models did not account for this 
global market plunge. Big money center banks are feeling quite exposed now and 
if this price slump lasts longer than a year they could be in very serious 
trouble again, in a repeat of 2007-2008 when the housing derivatives market 
collapsed. Estimates put the six larg

Re: Natural gas: The fracking fallacy

[John Clark]

On Thu, Dec 25, 2014 at 1:33 AM, 'Chris de Morsella' via Everything List <
everything-list@googlegroups.com> wrote:

>
>
>> >> I'm sorry Chris but that simply isn't true. Yes the Monterey shale
>> reserve was vastly overestimated, at one time they thought it contained
>> 15.4 billion barrels of oil but the true figure is less than a billion.
>> However just one oil shale deposit in the USA, the Green River Formation,
>> contains 1466 billion barrels of oil, nearly 100 times what Monterey was
>> thought to contain even at it's peak. So although embarrassing the
>> overestimate doesn't substantially change anything.
>>
>
> > Yeah… and if you believe those figures I have a bridge to sell you in
> Brooklyn. In fact those very numbers you site are controversial and
> disputed by many petroleum geologists.
>

What the hell are you talking about? There may be controversy over what
should be done with shale oil but there is scientific consensus over
approximately how much shale oil is on the planet and that most of it is in
the USA.


> > Just because it is shale does not mean that the hydrocarbons trapped in
> it are recoverable.
>

And that is why geologists say that there are 4.8 trillion barrels of shale
oil in the world with 3.7 trillion barrels of it being in the USA but only
1 trillion can be economically recovered with existing technology.

 > This oil is properly called "tight oil",


And until about 5 years ago almost 100% of shale oil was tight oil, but
technology marches on and today only about 75% is tight oil, and just that
25% is enough to cause a historic drop in oil prices that will dramatically
change geopolitics.

> As I said before all of that shale you speak about – the vast majority of
> shale deposits in the world are kerogen deposits – HAVE NOT BEEN EXPLOITED!
>

And as I've said existing technology can only exploit about 25% of it, but
that's more than enough to change the economy of the world.

> Why not?
>

Because 25% is the best technology can do. So far.

> Do you actually believe that all we need is better technology?
>

Yes.

> But today is not not 5 years from now and you have zero monetary, human,
>> legal and political resources and yet you claim to know exactly how much
>> gas and oil is in the ground in the USA that can be extracted economically;
>> all I want to know is how you acquired that information.
>>
>
> > How about you tell me where you get your facts first John.
>

I get my facts by reading science journals like Science and Nature. What do
you read, conspiracy theories political rants and blogs by empty headed
tree huggers?

> Bullshit on your bullshit John. When you sum up all the river of capital
> it has sucked up and the mountain of derivatives built up around this
> bubble, it is trillions.
>

Trillions? Maybe in some new form of mathematics but not in the type of
arithmetic I am familiar with.

> What I think has happened is that the price of oil has dropped from $147
>> to $60, and that is not a estimate or a opinion or a prediction, that my
>> friend is a fact. And you can wave your hands around all you want but it
>> won't change that monumentally important facet of reality.
>>
>
> > And what gives you the peculiar notion that I am disputing what are well
> known market price points. John, what you are doing in fact is itself empty
> hand waiving. You have said nothing here. Do you have nothing of substance
> to say?
>

It's a FACT that the price of oil has dropped from $147 to $60 and you say
that FACT has no substance! This conversation is getting surreal. No that's
the wrong word, it implies far too much gravitas, this conversation is
getting silly.  And by the way, this silly shale oil and the silly oil
price collapse that it caused resulted in the lead article on the front
page of today's (December 25 2014) New York Times:


Oil’s Swift Fall Raises Fortunes of U.S. Abroad

By ANDREW HIGGINS DEC. 24, 2014


BRUSSELS — A plunge in oil prices has sent tremors through the global
political and economic order, setting off an abrupt shift in fortunes that
has bolstered the interests of the United States and pushed several big
oil-exporting nations — particularly those hostile to the West, like
Russia, Iran and Venezuela — to the brink of financial crisis.

The nearly 50 percent decline in oil prices since June has had the most
conspicuous impact on the Russian economy and President Vladimir V. Putin.
The former finance minister Aleksei L. Kudrin, a longtime friend of Mr.
Putin’s, warned this week of a “full-blown economic crisis” and called for
better relations with Europe and the United States.

But the ripple effects are spreading much more broadly than that. The price
plunge may also influence Iran’s deliberations over whether to agree to a
deal on its nuclear program with the West; force the oil-rich nations of
the Middle East to reassess their role in managing global supply; and give
a boost to the  economies of the biggest oil-consuming nations, notably t

RE: Natural gas: The fracking fallacy

['Chris de Morsella' via Everything List]

 

 

From: everything-list@googlegroups.com 
[mailto:everything-list@googlegroups.com] 
Sent: Wednesday, December 24, 2014 9:10 PM
To: everything-list@googlegroups.com
Subject: Re: Natural gas: The fracking fallacy

 



Sent from AOL Mobile Mail

 

It could be just as you suggest, a chemical, toxic, nightmare, to be footed by 
the tax payers. But I am thinking not so much, as the chemicals used have been 
around for decades, with no great problem detected. Notice how cheaper the 
gasoline is now? Notice how russia, iran, and the saudi economy has been 
upended? The idea is a civilization completely powered by the sun. The real is 
fracking. But we can always hope.

In energy matters I prefer to look at five year moving averages for 
understanding price trends; doing so helps eliminate the noise of volatility in 
the market. 

Most of the independent drilling companies that dominate US shale production 
sell futures contracts to show lenders they have locked in an oil price that is 
higher than their cost of production. This is especially true for the many 
independent smaller operators; if they can’t hedge above their cost of 
production, they are dead in the water. The US shale play needs a sustained 
minimum of above $90 on the world oil futures markets in order to be able to 
sell these hedges and use them as the basis on which they can get new capital 
to continue drilling.

There are trillions of dollars of future hedge contracts most of which were 
underwritten by big money center banks whose models did not account for this 
global market plunge. Big money center banks are feeling quite exposed now and 
if this price slump lasts longer than a year they could be in very serious 
trouble again, in a repeat of 2007-2008 when the housing derivatives market 
collapsed. Estimates put the six largest “too big to fail” banks commodity 
derivatives contracts holdings around $3.9 trillion, a majority of which is 
comprised of various flavors of oil future hedges. Most of the drillers in the 
tight oil sector in the US have already locked in future prices for next year 
and up into 2016 at around $90 per barrel. For example, Noble Energy and Devon 
Energy have both hedged over three-quarters of their output for 2015, and 
Pioneer Natural Resources has options covering 67% of its likely production 
through 2016. 

These drillers have locked in price volatility protection for themselves (as 
long as the banks honor their losses), but what about the big banks themselves? 
If global oil spot price stagnates for much longer and these contracts start 
coming due the losses are going to be astronomical. Who will endup covering 
these losses? 

Interesting side note: Harold Hamm, the Oklahoma oil billionaire (heavily 
invested in the Bakken) has bet a big chunk of his fortune that oil prices will 
rise soon; cashing in on almost 40 million barrels worth of future hedges, 
reaping a current profit of over $433 million for this quarter, but exposing 
his firm to price volatility if oil spot prices should stagnate or even decline 
further. 

-Chris

 




-Original Message-
From: 'Chris de Morsella' via Everything List 
To: everything-list 
Sent: Wed, Dec 24, 2014 03:31 PM
Subject: Re: Natural gas: The fracking fallacy



 

  _  

From: spudboy100 via Everything List 
To: everything-list@googlegroups.com 
Sent: Wednesday, December 24, 2014 12:22 PM
Subject: Re: Natural gas: The fracking fallacy

 

>>It could be a bubble but its not. Nothing has paid off like shale gas. 
>>Nothing else in the world has paid off like this.  

 

Wait till the taxpayer gets dumped on with all those underwater derivatives the 
big money center banks have just made sure we are liable for. You have no idea 
of the mountain of debt that is about to avalanche down on the US financial 
system. 

 

 

Even a report I saw today on energy policy encouraged more expansion into solar 
so that it will acquire 10% of the US electricity market. If this is correct, 
then solar will be marginal unless there's a vast improvement in production and 
storage, like we all hoped for. It's like all the wonders dreamed of over the 
last several decades keep fading into the future, further and further. Probably 
solar or fusion will never be marginal, this century, and the next energy 
source after shale will be methane hydrates, and we all know what the fear of 
AGW is focused on, as well as Siberia.  I guess we play the hand we're dealt, 
even though its not what we wanted. 

  

Ho Ho Ho 

Merry Scrooge Day 

  

and be in all the earlier tomorrow! 

  

  

 

-Original Message- 
From: 'Chris de Morsella' via Everything List 
 
To: everything-list  
Sent: Wed, Dec 24, 2014 2:36 pm 
Subject: Re: Natural gas: The fracking fallacy 

 

  _  

From: John Clark 
To: everything-list@googlegroups.com 
Sent: Wednesday, December 24, 2014 10:53 AM
Subject: Re: Natural gas: The fracking fallacy

RE: Natural gas: The fracking fallacy

['Chris de Morsella' via Everything List]

 

 

From: everything-list@googlegroups.com 
[mailto:everything-list@googlegroups.com] On Behalf Of John Clark
Sent: Wednesday, December 24, 2014 7:49 PM
To: everything-list@googlegroups.com
Subject: Re: Natural gas: The fracking fallacy

 

On Wed, Dec 24, 2014  'Chris de Morsella' via Everything List 
 wrote:

 

> The Monterey reserves as stated by the EIA in their very highly visible 
> projections they made in 2011 accounted for well over 60% of the TOTAL tight 
> oil reserves in the USA

 

I'm sorry Chris but that simply isn't true. Yes the Monterey shale reserve was 
vastly overestimated, at one time they thought it contained 15.4 billion 
barrels of oil but the true figure is less than a billion. However just one oil 
shale deposit in the USA, the Green River Formation, contains 1466 billion 
barrels of oil, nearly 100 times what Monterey was thought to contain even at 
it's peak. So although embarrassing the overestimate doesn't substantially 
change anything. 

 

Yeah… and if you believe those figures I have a bridge to sell you in Brooklyn. 
In fact those very numbers you site are controversial and disputed by many 
petroleum geologists. Just because it is shale does not mean that the 
hydrocarbons trapped in it are recoverable. 

In the Bakken and Eagle Ford the extracted oil, actually exists as oil, but the 
shale does not allow the oil to flow very well. This oil is properly called 
"tight oil", and advances in hydraulic fracturing (fracking) technology have 
allowed some of this oil to be economically produced.

The oil shale in the Green River looks like rock instead.

Unlike the hydrocarbons in the tight oil formations, the oil shale (kerogen) 
consists of very heavy hydrocarbons that are solid. In that way, oil shale more 
resembles coal than oil. Oil shale is essentially oil that Mother Nature did 
not finish cooking, and thus to convert it into oil, heat has to be added. The 
energy requirements -- plus the fact that oil shale production requires a lot 
of water in a very dry environment -- have kept oil shale commercialization out 
of reach for over 100 years.

Ready to buy that bridge in Brooklyn… for you my friend I’ll give you a special 
price.

 

>>If you don't like the way they do it please describe the far superior method 
>>that you have developed for estimating how much oil and gas in the ground can 
>>be economically extracted.  I'm all ears. 

 

> I am not the one calling myself "The Energy Information Agency of the United 
> States of America" now am I. You give me the same monetary, human, legal and 
> political resources as the EIA and in five years I will give you numbers. 
> Deal?

 

But today is not not 5 years from now and you have zero monetary, human, legal 
and political resources and yet you claim to know exactly how much gas and oil 
is in the ground in the USA that can be extracted economically; all I want to 
know is how you acquired that information.

 

How about you tell me where you get your facts first John... other than the EIA 
(I can surf over there too and I have poured through a lot of their published 
materials too). I am not going to play this empty parlor game with you; if you 
doubt any of the facts I have stated then mount a specific – preferably fact 
based – challenge. 

 

>The shale play already has gone up John - it has sucked in trillions of dollars

 

Bullshit.

Bullshit on your bullshit John. When you sum up all the river of capital it has 
sucked up and the mountain of derivatives built up around this bubble, it is 
trillions.

 

 

 > and made the insiders billions of dollars.

 

True.

 

> What the hell do you think HAS BEEN happening during the past four years?

 

What I think has happened is that the price of oil has dropped from $147 to 
$60, and that is not a estimate or a opinion or a prediction, that my friend is 
a fact. And you can wave your hands around all you want but it won't change 
that monumentally important facet of reality. 

 

And what gives you the peculiar notion that I am disputing what are well known 
market price points. John, what you are doing in fact is itself empty hand 
waiving. You have said nothing here. Do you have nothing of substance to say?

 

>>Since the value of a energy derivative is a function of the value of the oil 
>>(or gas) in the ground, and since the value of a barrel of oil is less than 
>>half what it was just a few years ago then of course the value of those 
>>energy derivatives are going to go down too. But you need to put your money 
>>where your mouth is, you think the drop in the cost of oil is a very 
>>temporary thing, therefore you should be buying those energy derivatives as 
>>fast as you can.  And you should be buying them on margin to give yourself 
>>leverage, of course if you're wrong then the leve

Re: Natural gas: The fracking fallacy

[spudboy100 via Everything List]

Sent from AOL Mobile Mail

It could be just as you suggest, a chemical, toxic, nightmare, to be footed by 
the tax payers. But I am thinking not so much, as the chemicals used have been 
around for decades, with no great problem detected. Notice how cheaper the 
gasoline is now? Notice how russia, iran, and the saudi economy has been 
upended? The idea is a civilization completely powered by the sun. The real is 
fracking. But we can always hope.


-Original Message-
From: 'Chris de Morsella' via Everything List 
To: everything-list 
Sent: Wed, Dec 24, 2014 03:31 PM
Subject: Re: Natural gas: The fracking fallacy





 
  
   
  
  
 
   

 
  
  
From: spudboy100 via Everything 
List <mailto:everything-list@googlegroups.com";>everything-list@googlegroups.com>
 To: mailto:everything-list@googlegroups.com";>everything-list@googlegroups.com
 
 Sent: Wednesday, December 24, 
2014 12:22 PM
 Subject: Re: 
Natural gas: The fracking fallacy
  
 

 

 
  

   
>>It could be a bubble but its not. Nothing has paid off like shale gas. 
>>Nothing else in the world has paid off like this. 
   
   


   
   
Wait till the taxpayer gets dumped on with all those underwater derivatives the 
big money center banks have just made sure we are liable for. You have no idea 
of the mountain of debt that is about to avalanche down on the US financial 
system.
   
   


   
   


   
   
Even a report I saw today on energy policy encouraged more expansion into solar 
so that it will acquire 10% of the US electricity market. If this is correct, 
then solar will be marginal unless there's a vast improvement in production and 
storage, like we all hoped for. It's like all the wonders dreamed of over the 
last several decades keep fading into the future, further and further. Probably 
solar or fusion will never be marginal, this century, and the next energy 
source after shale will be methane hydrates, and we all know what the fear of 
AGW is focused on, as well as Siberia.  I guess we play the hand we're dealt, 
even though its not what we wanted.

   
 

   
Ho Ho Ho

   
Merry Scrooge Day

   
 

   
and be in all the earlier tomorrow!

   
 

   
 

   




   
   

-Original Message-
  From: 'Chris de Morsella' via Everything List <mailto:everything-list@googlegroups.com";>everything-list@googlegroups.com>
  To: everything-list <mailto:everything-list@googlegroups.com";>everything-list@googlegroups.com>
  Sent: Wed, Dec 24, 2014 2:36 pm
  Subject: Re: Natural gas: The fracking fallacy
  
  
  
   



 
 
 
 
  
   

From: John Clark <mailto:johnkcl...@gmail.com";>johnkcl...@gmail.com> 
To: mailto:everything-list@googlegroups.com";>everything-list@googlegroups.com
  Sent: 
Wednesday, December 24, 2014 10:53 AM Subject: Re: Natural 
gas: The fracking fallacy  
   
  


 
 
On Wed, Dec 24, 2014 'Chris de Morsella' via Everything List 
  <mailto:everything-list@googlegroups.com";>everything-list@googlegroups.com>
 wrote:
  
   
   
   
 
  
   
   
 > the very same 
EIA that got it so wrong with the Monterey shale deposit reserve projections it 
made in 2011

   
  
 

 
 

>>Yes they got it wrong with Monterey, estimating reserves isn't easy and is 
>>more a art than a science, but given that as far as anybody knows they got it 
>>right with the Bakken and Eagle Ford formation and they alone account for 70% 
>>of reserves so it's not a major consideration. Could they be wrong again? 
>>Sure. Could you also be wrong about reserves? No way!
 

  
 

Wrong!. Utterly wrong in fact, the Bakken did not account for 70% of the 
reserve picture presented by the EIA between 2011 and the middle of 2014 when 
they finally downgraded the Monterey shale reserve projections. The Monterey 
reserves as stated by the EIA in their very highly visible projections they 
made in 2011 accounted for well 

Re: Natural gas: The fracking fallacy

[John Clark]

On Wed, Dec 24, 2014  'Chris de Morsella' via Everything List <
everything-list@googlegroups.com> wrote:

>
> > The Monterey reserves as stated by the EIA in their very highly visible
> projections they made in 2011 accounted for well over 60% of the TOTAL
> tight oil reserves in the USA
>

I'm sorry Chris but that simply isn't true. Yes the Monterey shale reserve
was vastly overestimated, at one time they thought it contained 15.4
billion barrels of oil but the true figure is less than a billion. However
just one oil shale deposit in the USA, the Green River Formation, contains
1466 billion barrels of oil, nearly 100 times what Monterey was thought to
contain even at it's peak. So although embarrassing
the overestimate doesn't substantially change anything.

>>If you don't like the way they do it please describe the far superior
>> method that you have developed for estimating how much oil and gas in the
>> ground can be economically extracted.  I'm all ears.
>
>
> > I am not the one calling myself "The Energy Information Agency of the
> United States of America" now am I. You give me the same monetary, human,
> legal and political resources as the EIA and in five years I will give you
> numbers. Deal?
>

But today is not not 5 years from now and you have zero monetary, human,
legal and political resources and yet you claim to know exactly how much
gas and oil is in the ground in the USA that can be extracted economically;
all I want to know is how you acquired that information.

>The shale play already has gone up John - it has sucked in trillions of
> dollars


Bullshit.

 > and made the insiders billions of dollars.


True.


> > What the hell do you think HAS BEEN happening during the past four years?
>

What I think has happened is that the price of oil has dropped from $147 to
$60, and that is not a estimate or a opinion or a prediction, that my
friend is a fact. And you can wave your hands around all you want but it
won't change that monumentally important facet of reality.


> >>Since the value of a energy derivative is a function of the value of the
>> oil (or gas) in the ground, and since the value of a barrel of oil is less
>> than half what it was just a few years ago then of course the value of
>> those energy derivatives are going to go down too. But you need to put your
>> money where your mouth is, you think the drop in the cost of oil is a very
>> temporary thing, therefore you should be buying those energy derivatives as
>> fast as you can.  And you should be buying them on margin to give yourself
>> leverage, of course if you're wrong then the leverage works against you but
>> I'm sure there is no possibility you're wrong.
>
>
> > You should not be giving others free advice John.
>

You're right, I should have charged you for such valuable advice because if
you follow it you will became fabulously rich, or at least you will if you
really are smarter than the collective wisdom of millions of people on this
matter, that is to say if you really are smarter than the market.


> >>Bullshit, nobody promised endless supplies of anything.
>
>
> > Bullshit -- read the press releases
>

I'd love to read them but I can't seem to find these false press reports
you keep refer to, please show me some


> > The shale boom was very much presented as being able to supply the US
> with a secure and almost inexhaustible supply of fossil energy
>

I don't know what "almost inexhaustible" means but we are not going to run
out of shale oil in your lifetime or that of your children. The I*nternational
Energy Agency, which has nothing to do with  the government of the USA and
is in fact based in Paris, says that there are 4.8 trillion barrels of
shale oil in the world with 3.7 trillion barrels of it in the USA, although
only 1 trillion can be economically recoverable with existing technology.
The amount of conventional oil that exists, not just in Saudi Arabia, not
just in OPEC, but in the entire world is 1.3 trillion barrels. And that's
why I say **Saudi Arabia will run out of oil before the USA runs out of
oil.*

>>It's only right and just that low cost producers put high cost producers
> of oil or of anything else out of business, so if OPEC wishes to keep the
> shale people out of the oil business they're going to have to keep their
> production high enough that oil costs less than what the shale people cam
> make it for. Currently it costs between $95 and $30 to produce a barrel of
> oil from shale depending on the particulars of the geology, and as
> technology improves the cost will go down. That explains why $147 for a
> barrel of oil as it was at its peak in 2008 is not sustainable however much
> OPEC may wish it were, and Saudi Arabia will run out of oil before the USA
> runs out of shale.
>
>
> > You have bought into the line presented by the cornucopean press
> releases hook line and sinker. SHale oil does not cost $30 a barrel to
> produce.
>

Wikipedia thinks it's between $95 and $25 but I think 

Re: Natural gas: The fracking fallacy

['Chris de Morsella' via Everything List]

  From: spudboy100 via Everything List 
 To: everything-list@googlegroups.com 
 Sent: Wednesday, December 24, 2014 12:22 PM
 Subject: Re: Natural gas: The fracking fallacy
   
>>It could be a bubble but its not. Nothing has paid off like shale gas. 
>>Nothing else in the world has paid off like this. 
Wait till the taxpayer gets dumped on with all those underwater derivatives the 
big money center banks have just made sure we are liable for. You have no idea 
of the mountain of debt that is about to avalanche down on the US financial 
system.

Even a report I saw today on energy policy encouraged more expansion into solar 
so that it will acquire 10% of the US electricity market. If this is correct, 
then solar will be marginal unless there's a vast improvement in production and 
storage, like we all hoped for. It's like all the wonders dreamed of over the 
last several decades keep fading into the future, further and further. Probably 
solar or fusion will never be marginal, this century, and the next energy 
source after shale will be methane hydrates, and we all know what the fear of 
AGW is focused on, as well as Siberia.  I guess we play the hand we're dealt, 
even though its not what we wanted. Ho Ho HoMerry Scrooge Day and be in all the 
earlier tomorrow!  

-Original Message-
From: 'Chris de Morsella' via Everything List 
To: everything-list 
Sent: Wed, Dec 24, 2014 2:36 pm
Subject: Re: Natural gas: The fracking fallacy


  From: John Clark 
 To: everything-list@googlegroups.com 
 Sent: Wednesday, December 24, 2014 10:53 AM
 Subject: Re: Natural gas: The fracking fallacy
   
On Wed, Dec 24, 2014 'Chris de Morsella' via Everything List 
 wrote:


 > the very same EIA that got it so wrong with the Monterey shale deposit 
reserve projections it made in 2011

>>Yes they got it wrong with Monterey, estimating reserves isn't easy and is 
>>more a art than a science, but given that as far as anybody knows they got it 
>>right with the Bakken and Eagle Ford formation and they alone account for 70% 
>>of reserves so it's not a major consideration. Could they be wrong again? 
>>Sure. Could you also be wrong about reserves? No way!
Wrong!. Utterly wrong in fact, the Bakken did not account for 70% of the 
reserve picture presented by the EIA between 2011 and the middle of 2014 when 
they finally downgraded the Monterey shale reserve projections. The Monterey 
reserves as stated by the EIA in their very highly visible projections they 
made in 2011 accounted for well over 60% of the TOTAL tight oil reserves in the 
USA INCLUDING the Bakken, Marcelus and Eagle Ford formations. In other words 
the Bakken, the Marcelus and the Eagle Ford lumped together accounted for less 
than 40% of the reserve figures touted by the EIA AND used to blow up this 
massive bubble that is no bursting. The Monterey shale was the big daddy of 
them all, according to the EIA. This announcement was highly cited by the 
boosters of this bubble in order to whip up the mania of "The US becoming the 
Saudi Arabia of shale". Only after the hoopla had served its intended purpose 
(convincing investors that this was absolutely huge) were these non-existent 
reserves quietly downgraded -- in a non media event "quiet" announcement -- and 
by a whopping 94%!


> The EIA, IMO, is complicit in this fraud. And as evidence I produced the 
> grossly overstated reserve numbers it produced for the Monterey shale 
> deposits in 2011


>>If you don't like the way they do it please describe the far superior method 
>>that you have developed for estimating how much oil and gas in the ground can 
>>be economically extracted.  I'm all ears. 

I am not the one calling myself "The Energy Information Agency of the United 
States of America" now am I. You give me the same monetary, human, legal and 
political resources as the EIA and in five years I will give you numbers. Deal?


 > I am describing a huge financial bubble, 
>>The first financial bubble in the history of the planet that went down not up.
You really don't get bubbles do you? Bubbles go down when they blow up silly 
man. When the housing bubble blew to pieces in 2007-2008 did housing prices 
continue to rise? The shale play already has gone up John - it has sucked in 
trillions of dollars and made the insiders billions of dollars. What the hell 
do you think HAS BEEN happening during the past four years?This mania is now 
bursting.
 

> tied to tight oil sector energy derivatives that is bursting as we speak, yes.
>>Since the value of a energy derivative is a function of the value of the oil 
>>(or gas) in the ground, and since the value of a barrel of oil is less than 
>>half what it was just a few years ago then of course the value of those 
>>energy derivatives are going to go down

Re: Natural gas: The fracking fallacy

[spudboy100 via Everything List]

It could be a bubble but its not. Nothing has paid off like shale gas. Nothing 
else in the world has paid off like this. Even a report I saw today on energy 
policy encouraged more expansion into solar so that it will acquire 10% of the 
US electricity market. If this is correct, then solar will be marginal unless 
there's a vast improvement in production and storage, like we all hoped for. 
It's like all the wonders dreamed of over the last several decades keep fading 
into the future, further and further. Probably solar or fusion will never be 
marginal, this century, and the next energy source after shale will be methane 
hydrates, and we all know what the fear of AGW is focused on, as well as 
Siberia.  I guess we play the hand we're dealt, even though its not what we 
wanted.

Ho Ho Ho
Merry Scrooge Day

and be in all the earlier tomorrow!
 
 
-Original Message-
From: 'Chris de Morsella' via Everything List 
To: everything-list 
Sent: Wed, Dec 24, 2014 2:36 pm
Subject: Re: Natural gas: The fracking fallacy





  
 
 
 
   From: John Clark 
 To: everything-list@googlegroups.com 
 Sent: Wednesday, December 24, 2014 10:53 AM
 Subject: Re: Natural gas: The fracking fallacy
  
 



On Wed, Dec 24, 2014 'Chris de Morsella' via Everything List 
 wrote:




 > the very same EIA that got it so wrong with the Monterey shale deposit 
 > reserve projections it made in 2011




>>Yes they got it wrong with Monterey, estimating reserves isn't easy and is 
>>more a art than a science, but given that as far as anybody knows they got it 
>>right with the Bakken and Eagle Ford formation and they alone account for 70% 
>>of reserves so it's not a major consideration. Could they be wrong again? 
>>Sure. Could you also be wrong about reserves? No way!


Wrong!. Utterly wrong in fact, the Bakken did not account for 70% of the 
reserve picture presented by the EIA between 2011 and the middle of 2014 when 
they finally downgraded the Monterey shale reserve projections. The Monterey 
reserves as stated by the EIA in their very highly visible projections they 
made in 2011 accounted for well over 60% of the TOTAL tight oil reserves in the 
USA INCLUDING the Bakken, Marcelus and Eagle Ford formations. In other words 
the Bakken, the Marcelus and the Eagle Ford lumped together accounted for less 
than 40% of the reserve figures touted by the EIA AND used to blow up this 
massive bubble that is no bursting. The Monterey shale was the big daddy of 
them all, according to the EIA. This announcement was highly cited by the 
boosters of this bubble in order to whip up the mania of "The US becoming the 
Saudi Arabia of shale". Only after the hoopla had served its intended purpose 
(convincing investors that this was absolutely huge) were these non-existent 
reserves quietly downgraded -- in a non media event "quiet" announcement -- and 
by a whopping 94%!



> The EIA, IMO, is complicit in this fraud. And as evidence I produced the 
> grossly overstated reserve numbers it produced for the Monterey shale 
> deposits in 2011



>>If you don't like the way they do it please describe the far superior method 
>>that you have developed for estimating how much oil and gas in the ground can 
>>be economically extracted.  I'm all ears. 



I am not the one calling myself "The Energy Information Agency of the United 
States of America" now am I. You give me the same monetary, human, legal and 
political resources as the EIA and in five years I will give you numbers. Deal?






 > I am describing a huge financial bubble, 


>>The first financial bubble in the history of the planet that went down not up.


You really don't get bubbles do you? Bubbles go down when they blow up silly 
man. When the housing bubble blew to pieces in 2007-2008 did housing prices 
continue to rise? The shale play already has gone up John - it has sucked in 
trillions of dollars and made the insiders billions of dollars. What the hell 
do you think HAS BEEN happening during the past four years?
This mania is now bursting.


 



> tied to tight oil sector energy derivatives that is bursting as we speak, yes.


>>Since the value of a energy derivative is a function of the value of the oil 
>>(or gas) in the ground, and since the value of a barrel of oil is less than 
>>half what it was just a few years ago then of course the value of those 
>>energy derivatives are going to go down too. But you need to put your money 
>>where your mouth is, you think the drop in the cost of oil is a very 
>>temporary thing, therefore you should be buying those energy derivatives as 
>>fast as you can.  And you should be buying them on margin to give yourself 
>>leverage, of course if you're wrong then the leverage works against you but 
>>I'm s

Re: Natural gas: The fracking fallacy

['Chris de Morsella' via Everything List]

  From: John Clark 
 To: everything-list@googlegroups.com 
 Sent: Wednesday, December 24, 2014 10:53 AM
 Subject: Re: Natural gas: The fracking fallacy
   
On Wed, Dec 24, 2014 'Chris de Morsella' via Everything List 
 wrote:


 > the very same EIA that got it so wrong with the Monterey shale deposit 
reserve projections it made in 2011

>>Yes they got it wrong with Monterey, estimating reserves isn't easy and is 
>>more a art than a science, but given that as far as anybody knows they got it 
>>right with the Bakken and Eagle Ford formation and they alone account for 70% 
>>of reserves so it's not a major consideration. Could they be wrong again? 
>>Sure. Could you also be wrong about reserves? No way!
Wrong!. Utterly wrong in fact, the Bakken did not account for 70% of the 
reserve picture presented by the EIA between 2011 and the middle of 2014 when 
they finally downgraded the Monterey shale reserve projections. The Monterey 
reserves as stated by the EIA in their very highly visible projections they 
made in 2011 accounted for well over 60% of the TOTAL tight oil reserves in the 
USA INCLUDING the Bakken, Marcelus and Eagle Ford formations. In other words 
the Bakken, the Marcelus and the Eagle Ford lumped together accounted for less 
than 40% of the reserve figures touted by the EIA AND used to blow up this 
massive bubble that is no bursting. The Monterey shale was the big daddy of 
them all, according to the EIA. This announcement was highly cited by the 
boosters of this bubble in order to whip up the mania of "The US becoming the 
Saudi Arabia of shale". Only after the hoopla had served its intended purpose 
(convincing investors that this was absolutely huge) were these non-existent 
reserves quietly downgraded -- in a non media event "quiet" announcement -- and 
by a whopping 94%!


> The EIA, IMO, is complicit in this fraud. And as evidence I produced the 
> grossly overstated reserve numbers it produced for the Monterey shale 
> deposits in 2011


>>If you don't like the way they do it please describe the far superior method 
>>that you have developed for estimating how much oil and gas in the ground can 
>>be economically extracted.  I'm all ears. 

I am not the one calling myself "The Energy Information Agency of the United 
States of America" now am I. You give me the same monetary, human, legal and 
political resources as the EIA and in five years I will give you numbers. Deal?


 > I am describing a huge financial bubble, 
>>The first financial bubble in the history of the planet that went down not up.
You really don't get bubbles do you? Bubbles go down when they blow up silly 
man. When the housing bubble blew to pieces in 2007-2008 did housing prices 
continue to rise? The shale play already has gone up John - it has sucked in 
trillions of dollars and made the insiders billions of dollars. What the hell 
do you think HAS BEEN happening during the past four years?This mania is now 
bursting.
 

> tied to tight oil sector energy derivatives that is bursting as we speak, yes.
>>Since the value of a energy derivative is a function of the value of the oil 
>>(or gas) in the ground, and since the value of a barrel of oil is less than 
>>half what it was just a few years ago then of course the value of those 
>>energy derivatives are going to go down too. But you need to put your money 
>>where your mouth is, you think the drop in the cost of oil is a very 
>>temporary thing, therefore you should be buying those energy derivatives as 
>>fast as you can.  And you should be buying them on margin to give yourself 
>>leverage, of course if you're wrong then the leverage works against you but 
>>I'm sure there is no possibility you're wrong. 

You should not be giving others free advice John. 
 
 > I am describing this investment and perception mania that was manufactured 
 > on promises of endless supplies of new shale deposits. 
>>Bullshit, nobody promised endless supplies of anything.

Bullshit -- read the press releases and the perception management that flooded 
the media and was produced by think tank after think tank tied to these 
interests. The shale boom was very much presented as being able to supply the 
US with a secure and almost inexhaustible supply of fossil energy for a period 
of four or more decades. I argued with some of these boosters during the ramp 
up to this buble in 2009-2011 -- to hear them tell it the Bakken formation 
extended down all the way to China -- I jest, but that is the essence of their 
position. This boom has been sold as being able to secure America's energy 
needs for many decades and in fact it was supposed to turn America into a major 
supplier of gas and even oil to the the EU for example.

You do not seem to grasp the conce

Re: Natural gas: The fracking fallacy

[John Clark]

On Wed, Dec 24, 2014 'Chris de Morsella' via Everything List <
everything-list@googlegroups.com> wrote:

 > the very same EIA that got it so wrong with the Monterey shale deposit
> reserve projections it made in 2011
>

Yes they got it wrong with Monterey, estimating reserves isn't easy and is
more a art than a science, but given that as far as anybody knows they got
it right with the Bakken and Eagle Ford formation and they alone account
for 70% of reserves so it's not a major consideration. Could they be wrong
again? Sure. Could you also be wrong about reserves? No way!

> The EIA, IMO, is complicit in this fraud. And as evidence I produced the
> grossly overstated reserve numbers it produced for the Monterey shale
> deposits in 2011
>

If you don't like the way they do it please describe the far superior
method that you have developed for estimating how much oil and gas in the
ground can be economically extracted.  I'm all ears.

 > I am describing a huge financial bubble,
>
The first financial bubble in the history of the planet that went down not
up.

> tied to tight oil sector energy derivatives that is bursting as we speak,
> yes.
>
Since the value of a energy derivative is a function of the value of the
oil (or gas) in the ground, and since the value of a barrel of oil is less
than half what it was just a few years ago then of course the value of
those energy derivatives are going to go down too. But you need to put your
money where your mouth is, you think the drop in the cost of oil is a very
temporary thing, therefore you should be buying those energy derivatives as
fast as you can.  And you should be buying them on margin to give yourself
leverage, of course if you're wrong then the leverage works against you but
I'm sure there is no possibility you're wrong.


> > I am describing this investment and perception mania that was
> manufactured on promises of endless supplies of new shale deposits.
>
Bullshit, nobody promised endless supplies of anything.

> You do not seem to grasp the concept of low cost producers being able to
> put the squeeze on the high cost producers
>

It's only right and just that low cost producers put high cost producers of
oil or of anything else out of business, so if OPEC wishes to keep the
shale people out of the oil business they're going to have to keep their
production high enough that oil costs less than what the shale people cam
make it for. Currently it costs between $95 and $30 to produce a barrel of
oil from shale depending on the particulars of the geology, and as
technology improves the cost will go down. That explains why $147 for a
barrel of oil as it was at its peak in 2008 is not sustainable however much
OPEC may wish it were, and Saudi Arabia will run out of oil before the USA
runs out of shale.

  John K Clark










>
>
>
>
>
>
>
>
>
>
>
>
>
>
> [image: image]
> 
>
>
>
>
>
>
>
>
>
>
>
> VIENNA (Reuters) - Saudi Arabia blocked calls on Thursday from poorer
> members of the OPEC oil exporter group for production cuts to arrest a
> slide in global prices,...
>
> View on *www.reuters.com*
> 
>
> Preview by Yahoo
>
>
>
>
>
>
>
>

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RE: Natural gas: The fracking fallacy

['Chris de Morsella' via Everything List]

 

 

From: everything-list@googlegroups.com 
[mailto:everything-list@googlegroups.com] On Behalf Of John Clark
Sent: Tuesday, December 23, 2014 8:18 PM
To: everything-list@googlegroups.com
Subject: Re: Natural gas: The fracking fallacy

 

On Tue, Dec 23, 2014 at 7:08 PM, 'Chris de Morsella' via Everything List 
 wrote:

 

>> I was under the mistaken impression that you understood that historically 
>> the proven oil reserves of a country have remained about as constant as the 
>> New York Stock Exchange, it changes every time a new oil discovery is made, 
>> and even more important, it changes  every time a new technology is 
>> developed that allows for the economic extraction of oil in places where it 
>> had previously been uneconomic.

 

> If that is the case can you kindly point these new super giant fields that 
> must have been discovered

 

I'll do better than that, I'll give you a chart of all the oil and gas reserves 
of all the super giant fields combined in all of the USA as they have changed 
from 1073 to 2013.

 

Yes, the very same EIA that got it so wrong with the Monterey shale deposit 
reserve projections it made in 2011 – that were projected to be far larger than 
the Bakken or Marcelus (have you noticed I actually site the important geologic 
formations by name) All you gave is the one bucket global reserve projections 
made by an agency that has a track record of producing reserve projections that 
it is forced to later revise downwards by 94%.

Am I supposed to be impressed?



 
http://www.usnews.com/cmsmedia/69/cb/488ad887410c904878caf6f3a11d/141204-eiareserves-graphic.png

 

> the bubble mania that was being frothed up in the media

 

There you go again, oil and gas prices are dropping like a rock and you're 
still babbling about a bubble. 

 

I am describing a huge financial bubble, tied to tight oil sector energy 
derivatives that is bursting as we speak, yes. I am describing this investment 
and perception mania that was manufactured on promises of endless supplies of 
new shale deposits. The EIA, IMO, is complicit in this fraud. And as evidence I 
produced the grossly overstated reserve numbers it produced for the Monterey 
shale deposits in 2011, as well as reserve numbers that are proving highly 
optimistic for other formations (the Bakken, Marcelus). Six months ago – with 
hardly anyone noticing the EIA, revised those rosy projections down by 94%.

What are you babbling about, John?

 

 

>> So your theory is that the price of oil collapsed from $130 to $60 because 
>> of some sort of byzantine conspiracy of the Saudi's, but your theory just 
>> does not fit the facts.

 

> You have not been following the news coming from recent OPEC meetings have 
> you. 

 

Saudis block OPEC output cut, sending oil price plunging 
<http://www.reuters.com/article/2014/11/27/us-opec-meeting-idUSKCN0JA0O320141127>
 

For god's sake, don't you at least read the title of articles before you 
recommend one to the list?! The title of the article is "Saudis block OPEC 
output cut" ; the key words are BLOCK and CUT! The Saudis decided NOT to 
decrease production but to keep it CONSTANT. Meanwhile the USA INCREASED oil 
production from 5.0 million barrels per day in 2008 to 7.4 million in 2013 and 
8.5 million this year and it is expected to be 9.3 million in 2015. Knowing 
that do we really need conspiracy theories to explain the huge drop in oil 
prices since 2008? 

You continue to believe in whatever numbers the EIA is putting out – even after 
such embarrassing lack of accuracy of their previous and very loudly and widely 
quoted reserve projections for what was to be an even much larger formation 
than the Bakken. Once the bankruptcies start happening in the oil patch US 
production numbers will begin to slide. Your rosy – EIA produced projections 
will (as is their habit) have to be revised (quietly with little media 
attention) downwards.

You don’t seem to understand the implications of a global spot price of under 
$60 for oil for the drillers in the Bakken, Marcelus and Eagle Ford shale 
deposits. These are debt financed operations that have a voracious need for 
huge amounts of new capital just in order to sustain current levels of 
production. Production that does not make economic sense at anything less than 
$100 per barrel. New financing, is not going to be available with oil at under 
$60 and the drillers will get no loans till it again climbs to well over $100. 
The financing bottleneck is going to really hurt this sector and constrict the 
rate at which upstream projects make it to market.

>> And the free market ensures that the sort of silly conspiracy you're so 
>> concerned about could never work. I manufacture 99% of the worlds widgets, 
>> you make 1%. I want to drive you out of business, so I figure I'll lower m

Re: Natural gas: The fracking fallacy

[John Clark]

On Tue, Dec 23, 2014 at 7:08 PM, 'Chris de Morsella' via Everything List <
everything-list@googlegroups.com> wrote:

>
> >> I was under the mistaken impression that you understood that
>> historically the proven oil reserves of a country have remained about as
>> constant as the New York Stock Exchange, it changes every time a new oil
>> discovery is made, and even more important, it changes  every time a new
>> technology is developed that allows for the economic extraction of oil in
>> places where it had previously been uneconomic.
>>
>> > If that is the case can you kindly point these new super giant fields
> that must have been discovered
>

I'll do better than that, I'll give you a chart of all the oil and gas
reserves of all the super giant fields combined in all of the USA *as they
have changed* from 1073 to 2013.

[image:
http://www.usnews.com/cmsmedia/69/cb/488ad887410c904878caf6f3a11d/141204-eiareserves-graphic.png]


> > the bubble mania that was being frothed up in the media
>

There you go again, oil and gas prices are dropping like a rock and you're
still babbling about a bubble.

>> So your theory is that the price of oil collapsed from $130 to $60
>> because of some sort of byzantine conspiracy of the Saudi's, but your
>> theory just does not fit the facts.
>>
>
> > You have not been following the news coming from recent OPEC meetings
> have you.
>
> Saudis block OPEC output cut, sending oil price plunging


For god's sake, don't you at least read the title of articles before you
recommend one to the list?! The title of the article is "Saudis block OPEC
output cut" ; the key words are BLOCK and CUT! The Saudis decided NOT to
decrease production but to keep it CONSTANT. Meanwhile the USA INCREASED
oil production from 5.0 million barrels per day in 2008 to 7.4 million in
2013 and 8.5 million this year and it is expected to be 9.3 million in
2015. Knowing that do we really need conspiracy theories to explain the
huge drop in oil prices since 2008?

>> And the free market ensures that the sort of silly conspiracy you're so
>> concerned about could never work. I manufacture 99% of the worlds widgets,
>> you make 1%. I want to drive you out of business, so I figure I'll lower my
>> price until you go broke and then I can jack them up to anything I want. So
>> now you lose money on each widget you sell, the trouble is I do too. I have
>> 99 times as much money as you do, but I'm losing it 99 times faster. Even
>> worse, because the price is very low the demand for widgets is huge, and if
>> prices are to remain low I must build more factories (or oil wells) and
>> increase production. I'm losing money faster and faster, meanwhile you just
>> temporally halt production in your small factory and wait for me to go
>> broke. It won't be a long wait.
>>
>
> > How can I possibly benefit from an economics 101 lesson from a man who
> swallows cornucopean reserve statements hook line and sinker.
>

>From that non-response would I be correct in assuming that you have no
logical counter argument?

  John K Clark

==







>







[image: image]







VIENNA (Reuters) - Saudi Arabia blocked calls on Thursday from poorer
members of the OPEC oil exporter group for production cuts to arrest a
slide in global prices,...

View on www.reuters.com

Preview by Yahoo










>

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Re: Natural gas: The fracking fallacy

['Chris de Morsella' via Everything List]

  From: John Clark 
   
On Mon, Dec 22, 2014 'Chris de Morsella' via Everything List 
 wrote:



>> In the USA oil production rose by more than half a million barrels per day 
>> between 2007 and 2011 to the highest level in 15 years, and in that same 
>> year the USA exported more gasoline and diesel than it imported for the 
>> first time since 1949. And in 2012 USA oil production increased by another 
>> 760,000 barrels a day, the largest yearly increase since records about oil 
>> production started in 1859. But incredibly 2013 beat even that record, oil 
>> production in the United States rose by another 992,000 barrels a day! And 
>> in 2014 the USA overtook Saudi Arabia to become the largest producer of oil 
>> on planet Earth, it was already the largest natural gas producer in the 
>> world and has been since 2010.


> Yes, so what?


>>So the "false projections" about the USA becoming the next Saudi Arabia 
>>turned out to be true.
That is misleading and is myopically focused in on the incomplete picture given 
by just looking at current production numbers. The meme of "The USA becoming 
the Saudi Arabia of shale" is that this resource base was as large in scale as 
the Saudi mega fields and that the USA would achieve long term fossil oil & gas 
independence based on these -- massively overstated reserves being produced.It 
does not matter much ion the long run if for a few years and at the cost of 
trillions of dollars of sunk capital that could have been better allocated in 
other sectors, the US has managed to -- very temporarily -- increase it's 
current production. The fact is we cannot sustain the level of drilling that 
would be required just to hold production levels current levels; fracked wells 
deplete a lot more rapidly than traditional oil & gas wells do. This assertion 
is borne out by the actual (public domain) data that exists for the older more 
mature tight oil play of the Eagle Ford formations (which ere developed before 
the Marcellus and the Bakken)If you want to grab on to that much repeated sound 
bite -- go ahead run with it, but it is little more than a fig leaf and does 
not give an accurate picture of the energy production capacity of the US tight 
oil sector over the next decades.


 > I was under the mistaken impression that you understood what reserves mean,


>>And I was under the mistaken impression that you understood that historically 
>>the proven oil reserves of a country have remained about as constant as the 
>>New York Stock Exchange, it changes every time a new oil discovery is made, 
>>and even more important, it changes  every time a new technology is developed 
>>that allows for the economic extraction of oil in places where it had 
>>previously been uneconomic.

If that is the case can you kindly point these new super giant fields that must 
have been discovered and are in the ever growing reserve numbers you seem to 
believe in. Where are the new Ghawar super giants? They are not being 
discovered John. Traditional oil has already peaked some years ago and the 
tight oil sector will not be able to sustain the current production rates, 
especially now that the global capital market for this sector is in full blown 
retreat. The EIA has had to very significantly downgrade a lot of its reserve 
projections in the US -- so I really don't have a clue what numbers you are 
referring to and who is producing the numbers you seem to believe in.

 
> Reserves measure what is in the ground that can be recovered.

Reserves measure what is known to be in the ground that can be recovered 
economically with existing technology. 
Yes. That is what reserves are supposed to be measuring, but as the recent 
fiasco with the EIA reserve projections for the California Monterey shale 
formation (from May of last year) the stated reserve numbers of even the 
official agency of the US government responsible for producing these numbers 
needs to be taken with a lot of skepticism.  Three years ago -- at the 
beginning of this boom -- and also very much by the way adding a a lot of fuel 
to the shale play bubble  -- the EIA estimated that California's Monterey 
formation contained some 15.4 billion barrels of technically recoverable oil - 
about 64 percent of total U.S. shale oil reserves. Last May the EIA announced 
it had reduced the Monterey's reserve potential to just 600 million barrels - a 
measly 4% of its 2011 estimate. 
Thus the largest -- and largest by far -- alleged shale oil reserve in the USA 
e.g. the Monterey shale deposit -- has had its reserve potential reduced down 
to just 600 million barrels - about four percent of its 2011 estimate. In other 
words a full 96% of the 2011 reserve numbers have just vanished into thin air 
-- e.g. they never existed! What is left unreported is how the original totally 
overblown EIA figures were very much used by the shale boosters to build the 
bubble mania that was being frothed up in the media and amongst investors 
duri

Re: Natural gas: The fracking fallacy

[John Clark]

On Mon, Dec 22, 2014 'Chris de Morsella' via Everything List <
everything-list@googlegroups.com> wrote:

>> In the USA oil production rose by more than half a million barrels per
>> day between 2007 and 2011 to the highest level in 15 years, and in that
>> same year the USA exported more gasoline and diesel than it imported for
>> the first time since 1949. And in 2012 USA oil production increased by
>> another 760,000 barrels a day, the largest yearly increase since records
>> about oil production started in 1859. But incredibly 2013 beat even that
>> record, oil production in the United States rose by another 992,000 barrels
>> a day! And in 2014 the USA overtook Saudi Arabia to become the largest
>> producer of oil on planet Earth, it was already the largest natural gas
>> producer in the world and has been since 2010.
>>
>
> > Yes, so what?
>

So the "false projections" about the USA becoming the next Saudi Arabia
turned out to be true.

> I was under the mistaken impression that you understood what reserves
> mean,
>

And I was under the mistaken impression that you understood that
historically the proven oil reserves of a country have remained about as
constant as the New York Stock Exchange, it changes every time a new oil
discovery is made, and even more important, it changes  every time a new
technology is developed that allows for the economic extraction of oil in
places where it had previously been uneconomic.


> > Reserves measure what is in the ground that can be recovered.
>

Reserves measure what is known to be in the ground that can be recovered
economically with existing technology.

>> Explain to me how the Saudi's will make more cash when oil is selling at
>> $60 a barrel then it did when it was selling at $130 a barrel. Is this some
>> new form of mathematics?
>>
>
> > Are you trying to be ironic or cute? Clearly the Saudi's feel they can
> endure the loss now in order to drive a large portion of the higher cost
> producers out of business.
>

So your theory is that the price of oil collapsed from $130 to $60 because
of some sort of byzantine conspiracy of the Saudi's, but your theory just
does not fit the facts. During the time of the oil collapse Saudi Arabia
did NOT increase their oil production, they kept on using the same old
technology and their production remained constant. However during that time
the USA  started using a new technology, and they increased their oil
production, and did so DRAMATICALLY. And the USA increased its gas
production even more. There is no need to invoke sinister plots by James
Bond style villains, it's a simple rule of economics that when the supply
of commodity X increases the price of commodity X falls.

And the free market ensures that the sort of silly conspiracy you're so
concerned about could never work. I manufacture 99% of the worlds widgets,
you make 1%. I want to drive you out of business, so I figure I'll lower my
price until you go broke and then I can jack them up to anything I want. So
now you lose money on each
widget you sell, the trouble is I do too. I have 99 times as much money as
you do, but I'm losing it 99 times faster. Even worse, because the price is
very low the demand for widgets is huge, and if prices are to remain low I
must build more factories (or oil wells) and increase production. I'm
losing money faster and faster,
meanwhile you just temporally halt production in your small factory and
wait for me to go broke. It won't be a long wait.

 John K Clark





 John K Clark widget

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Re: Natural gas: The fracking fallacy

['Chris de Morsella' via Everything List]

  From: John Clark 
 To: everything-list@googlegroups.com 
 Sent: Monday, December 22, 2014 11:46 AM
 Subject: Re: Natural gas: The fracking fallacy
   


On Sun, Dec 21, 2014 at 11:47 PM, 'Chris de Morsella' via Everything List 
 wrote:


> When the research arm of an investment house is leading the booster charge – 
> “America the Saudi Arabia of Shale” etc. and is knowingly using these false 
> projections


>>What in the world was false about those projections?
Reserve projections project an estimate for the total recoverable  oil (or gas) 
in a deposit. The EIA reserve numbers for tight oil & gas -- and to an even 
much more extreme degree, the stated reserve numbers produced by organizations 
(that subsequently profited immensely from the resulting investment boom) -- 
are highly inflated. You confuse and conflate a few years of increased 
production with reserves. They are measuring very different things. Reserves 
measure what is ultimately recoverable; production measures the rate at which a 
resource is being produced at. Perhaps this will help you understand the 
difference between the meaning of these two metrics; I was under the mistaken 
impression that you understood what reserves mean, in the context of talking 
about oil or gas reserves.


>> In the USA oil production rose by more than half a million barrels per day 
>> between 2007 and 2011 to the highest level in 15 years, and in that same 
>> year the USA exported more gasoline and diesel than it imported for the 
>> first time since 1949. And in 2012 USA oil production increased by another 
>> 760,000 barrels a day, the largest yearly increase since records about oil 
>> production started in 1859. But incredibly 2013 beat even that record, oil 
>> production in the United States rose by another 992,000 barrels a day! And 
>> in 2014 the USA overtook Saudi Arabia to become the largest producer of oil 
>> on planet Earth, it was already the largest natural gas producer in the 
>> world and has been since 2010.
Yes, so what? How long will this rate of production be sustained? Reserves 
measure what is in the ground that can be recovered. What you fail to 
understand about the tight oil sector is that the current very temporary 
production boom cannot be sustained -- just to maintain current levels of 
production would require a huge numbers of new wells to be drilled and fracked, 
because depletion is so fast. The capital expenditures of drilling then 
fracking a deposit cannot be  justified by the amount of oil & gas that is 
ultimately extracted by expending that capital.You can also make ethanol from 
corn, but at what cost? That you can make it does not mean it is worth it to 
make it. In the case of corn ethanol it actually takes more energy to produce 
it than can be extracted -- as useful work - by burning it; e.g. it has a 
negative EROI. For fracked tight gas & oil it is now being painfully discovered 
that a huge amount of capital has been sunk in theses fracked wells and in 
reality very little return will come from it. Before you go repeat those -- 
very temporary -- rosy production figures you will no doubt site again; 
meditate on how much capital was expended and sunk in order to obtain this 
transient few years of increased production.


> The Saudi’s will cash in

>>Explain to me how the Saudi's will make more cash when oil is selling at $60 
>>a barrel then it did when it was selling at $130 a barrel. Is this some new 
>>form of mathematics?
Are you trying to be ironic or cute? Clearly the Saudi's feel they can endure 
the loss now in order to drive a large portion of the higher cost producers out 
of business. Once they have achieved this goal they can cut back on their 
production and enjoy the much higher prices they will be able to sell their oil 
for -- without the plethora of upstart competitors competing for market share 
(because they have been driven to bankruptcy in the interim)Perhaps this is too 
hard for you to grasp (my turn to be ironic)-Chris
  



  John K Clark



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Re: Natural gas: The fracking fallacy

[John Clark]

On Sun, Dec 21, 2014 at 11:47 PM, 'Chris de Morsella' via Everything List <
everything-list@googlegroups.com> wrote:

> When the research arm of an investment house is leading the booster
> charge – “America the Saudi Arabia of Shale” etc. and is knowingly using
> these false projections
>

What in the world was false about those projections?  In the USA oil
production rose by more than half a million barrels per day between 2007
and 2011 to the highest level in 15 years, and in that same year the USA
exported more gasoline and diesel than it imported for the first time since
1949. And in 2012 USA oil production increased by another 760,000 barrels a
day, the largest yearly increase since records about oil production started
in 1859. But incredibly 2013 beat even that record, oil production in the
United States rose by another 992,000 barrels a day! And in 2014 the USA
overtook Saudi Arabia to become the largest producer of oil on planet
Earth, it was already the largest natural gas producer in the world and has
been since 2010.

> The Saudi’s will cash in


Explain to me how the Saudi's will make more cash when oil is selling at
$60 a barrel then it did when it was selling at $130 a barrel. Is this some
new form of mathematics?

  John K Clark

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Re: Natural gas: The fracking fallacy

[LizR]

All we know for certain is that oil and gas are finite resources that are
damaging the environment. The exact details of how this will play out are
uncertain, but we're getting more and more "once in a lifetime" weather
events around the world.

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RE: Natural gas: The fracking fallacy

['Chris de Morsella' via Everything List]

 

 

From: everything-list@googlegroups.com 
[mailto:everything-list@googlegroups.com] On Behalf Of John Clark
Sent: Sunday, December 21, 2014 7:01 PM
To: everything-list@googlegroups.com
Subject: Re: Natural gas: The fracking fallacy

 

On Sun, Dec 21, 2014 , 'Chris de Morsella' via Everything List 
 wrote:

 

>You are out of touch on energy matters my dear fellow. The EIA and even more 
>so many investment houses such as Goldman Sachs for example where making 
>spectacular predictions about the extent of the capacity of the shale deposits 
>in the continental US; predictions that have proved spectacularly wrong.

 

That's true, they were spectacularly wrong. Back in 2011 they bought oil at 
$130 a barrel because they predicted the price of oil could only go up. Today 
it's selling at $60 a barrel. So I repeat me request, after that epic disaster 
explain to me why I should pay attention to their latest prognostication

 

I was specifically referring to published reserve estimates by the EIA, as well 
as by Goldman Sachs and other institutions heavily vested in – and that have so 
far very much profited from -- this tight oil & gas sector bubble. 

You seem to be referring to futures. That is very different. What you refer to 
is simply a bad bet in the market; what I am referring to is shoddy 
unprofessional reporting at best (the EIA), but quite possibly fraudulent 
promotion of false projections and inflated reserves in order to profit from 
bamboozled investors. When the research arm of an investment house is leading 
the booster charge – “America the Saudi Arabia of Shale” etc. and is knowingly 
using these false projections and rosy projections in order for its investment 
arm to lure investors into believing they will profit and to make money from 
servicing the bubble it helped to create… that smells unethical and like 
something that should be illegal.

 

 

> The shale gas boom has the smell of a manic bubble 

 

Manic!? Bubble!? The price of gas is dropping like a rock, how in hell is that 
a bubble?

 

The entire tight oil & gas sector is in the initial stages of a major collapse 
in the US and Canada (tar sands) that is going to have major implications for 
the wider economy and may cripple our brittle too big to fail crony financial 
system of New York Fed favorites. Wait till we tax payers get the bill when 
these institutions begin imploding on the coming wave of bankruptcies in the 
tight oil & gas sector triggering an even larger financial tsunami off all of 
that worthless paper vanishing from their balance sheets. You will perhaps have 
a clearer idea then of what I intend by bubble.

 

>  How do you think drillers financed the very significant capital expenditures 
> required in order to horizontal drill and then frack a deposit? There is a 
> very big pile of debt; debt that will never yield a return, now that the 
> market has collapsed.

 

As I explained, the collapse of oil prices is very bad news for oil drillers 
and those who made a bet on them, but very good news for nearly everybody else. 
 

 

No it isn’t. This kind of wild swing in the price of oil is jeopardizing the 
continuity of future supply and development of upstream reserves. What the 
world needs is a steady and slowly rising price of oil, that reflects its 
increasing scarcity. This kind of wild swing is hugely damaging and you and I 
and everyone will pay for it when it swings the other direction and the 
upstream supplies that would have been there – given a steady predictable price 
scenario – are not there.

It takes many years sometimes even decades to fully develop a new field.

For example this current wild price swing is literally killing the North Sea 
oil sector. The whole upstream pipeline of capital allocation and development 
for bringing reserves to market in five to ten years or so of time has been 
badly de-railed.

The very fact you portray this wild price swing in such a vital commodity as 
energy as being a good thing for everyone else betrays your quite casual 
understanding of the energy sector and the very long time frame planning that 
goes on in that sector. If you do not grasp how swings like this wreak havoc on 
projects that may be still many years from market then finance is not your 
strong suite either.

 

 >> New technology, in particular fracking, has been very bad news for the oil 
 >> companies bottom line even if it's good new for the economy as a whole.

 

> Who do you think is doing the fracking?

 

Oh I don't know, I would guess  companies that are in the oil and gas sector.

 

> I’ll give you a hint… companies that are in the oil and gas sector.

 

And why would they do that? Because they know that if they don't somebody else 
will. Selling twice as many barrels at a third the price is bad, but selling 
the same number of barrels at a third the price is worse.  

 

Re: Natural gas: The fracking fallacy

[John Clark]

On Sun, Dec 21, 2014 , 'Chris de Morsella' via Everything List <
everything-list@googlegroups.com> wrote:

>You are out of touch on energy matters my dear fellow. The EIA and even
> more so many investment houses such as Goldman Sachs for example where
> making spectacular predictions about the extent of the capacity of the
> shale deposits in the continental US; predictions that have proved
> spectacularly wrong.


That's true, they were spectacularly wrong. Back in 2011 they bought oil at
$130 a barrel because they predicted the price of oil could only go up.
Today it's selling at $60 a barrel. So I repeat me request, after that epic
disaster explain to me why I should pay attention to their latest
prognostication

> The shale gas boom has the smell of a manic bubble


Manic!? Bubble!? The price of gas is dropping like a rock, how in hell is
that a bubble?

>  How do you think drillers financed the very significant capital
> expenditures required in order to horizontal drill and then frack a
> deposit? There is a very big pile of debt; debt that will never yield a
> return, now that the market has collapsed.
>

As I explained, the collapse of oil prices is very bad news for oil
drillers and those who made a bet on them, but very good news for nearly
everybody else.

 >> New technology, in particular fracking, has been very bad news for the
>> oil companies bottom line even if it's good new for the economy as a whole.
>
>

> Who do you think is doing the fracking?
>

Oh I don't know, I would guess  companies that are in the oil and gas
sector.


> > I’ll give you a hint… companies that are in the oil and gas sector.


And why would they do that? Because they know that if they don't somebody
else will. Selling twice as many barrels at a third the price is bad, but
selling the same number of barrels at a third the price is worse.

  John K Clark


>

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RE: Natural gas: The fracking fallacy

['Chris de Morsella' via Everything List]

 

 

From: everything-list@googlegroups.com 
[mailto:everything-list@googlegroups.com] On Behalf Of John Clark
Sent: Sunday, December 21, 2014 4:03 PM
To: everything-list@googlegroups.com
Subject: Re: Natural gas: The fracking fallacy

 

On Sun, Dec 21, 2014  'Chris de Morsella' via Everything List 
 wrote:

 

>> The fact that just 5 years ago NOBODY predicted the huge increase in oil and 
>> gas production that occurred doesn't exactly fill me with confidence that 
>> those same experts who got it so wrong 5 years ago have got it right this 
>> time.


 J> John – Definitely *NOT* the same experts who got their hyper optimistic 
assumption predictions  so terribly wrong.

 

NOBODY was making  hyper optimistic predictions 5 years ago, everybody was 
running around screaming about "peak oil" and crying that we were all doomed, 
instead oil and gas production skyrocketed. So I ask you, when a self described 
expert makes a prediction that turns out to be spectacularly wrong how 
seriously should we take their next prediction? 

 

You are out of touch on energy matters my dear fellow. The EIA and even more so 
many investment houses such as Goldman Sachs for example where making 
spectacular predictions about the extent of the capacity of the shale deposits 
in the continental US; predictions that have proved spectacularly wrong. There 
is a whole lot of conflict of interest in this story; it is important to keep 
in mind the scale of this boom; to understand that huge fortunes were at stake 
and made. The investment banks are in this up to their necks, drunk on the easy 
money of quantitative easement. The derivatives mountain that has been built 
around the shale sector boom is huge; there are massive secondary financial 
bets and securitized debt, packaged up and sold as derivatives that have also 
mushroomed out around this market.

The thing to keep in mind is the scale of this boom. The financial scale of it. 
How much debt it has created and how this debt has been securitized. 

Ask yourself who is holding the risk? Who made the profit?

The shale bubble is a multiple trillion dollar bonanza for the smart money and 
a Ponzi scheme for the general public that – mark my words – will be left 
holding the bill for all those derivatives that now seem about to go belly up.

The shale gas boom has the smell of a manic bubble – and many insiders 
certainly made a lot of money from it. However when, ultimately, the long term 
numbers are crunched and the return on capital invested is figured out the 
fundamental false premise of the mania will become as clear to us (in ten 
years), as the Tulip mania became to the Dutch, after that quintessential 
bubble burst on them long ago. 

Outside of some small sweet spots the shale oil deposits do not yield a 
marginal rate of return on capital. The boom was also built upon and predicated 
on applying the historic data on depletion rates – derived from traditional gas 
wells – to fracked deposits. It turns out – unsurprisingly – that fracked wells 
behave differently from wells producing from traditional non-fracked porous 
deposits; their rates of depletion are *far* higher. Insider petroleum 
geologists have known this for a while, but the shale boosters preferred the 
look and feel of those traditional depletion curves and promoted that alternate 
reality.

 

 

 

 

> if you look at how interest rates for junk bonds for drillers etc. have 
> recently shot up, the picture becomes clear.

 

Very clear indeed!  Of course cost of buying a oil bond has gone down and thus 
the interest it produces has gone up, it's economics 101. As recently as 2011 
oil was going for $130 a barrel, today it's about $60, so obviously the cost of 
buying a bond that uses oil as collateral is going to go down and its interest 
rate is going to go up. Today the oil reserves of oil companies is worth less 
than half what it was worth in 2011, so it's going to cost more for oil 
companies to borrow money, and borrowing money is what a bond is all about.

 

Not just that John. How do you think drillers financed the very significant 
capital expenditures required in order to horizontal drill and then frack a 
deposit? There is a very big pile of debt; debt that will never yield a return, 
now that the market has collapsed.

 

New technology, in particular fracking, has been very bad news for the oil 
companies bottom line even if it's good new for the economy as a whole.

 

Who do you think is doing the fracking? I’ll give you a hint… companies that 
are in the oil and gas sector.

Chris

 

John K Clark

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Re: Natural gas: The fracking fallacy

[John Clark]

On Sun, Dec 21, 2014  'Chris de Morsella' via Everything List <
everything-list@googlegroups.com> wrote:

>> The fact that just 5 years ago NOBODY predicted the huge increase in oil
>> and gas production that occurred doesn't exactly fill me with confidence
>> that those same experts who got it so wrong 5 years ago have got it right
>> this time.
>
>
>  J> John – Definitely *NOT* the same experts who got their hyper
> optimistic assumption predictions  so terribly wrong.


NOBODY was making  hyper optimistic predictions 5 years ago, everybody was
running around screaming about "peak oil" and crying that we were all
doomed, instead oil and gas production skyrocketed. So I ask you, when a
self described expert makes a prediction that turns out to be spectacularly
wrong how seriously should we take their next prediction?

> if you look at how interest rates for junk bonds for drillers etc. have
> recently shot up, the picture becomes clear.


Very clear indeed!  Of course cost of buying a oil bond has gone down and
thus the interest it produces has gone up, it's economics 101. As recently
as 2011 oil was going for $130 a barrel, today it's about $60, so obviously
the cost of buying a bond that uses oil as collateral is going to go down
and its interest rate is going to go up. Today the oil reserves of oil
companies is worth less than half what it was worth in 2011, so it's going
to cost more for oil companies to borrow money, and borrowing money is what
a bond is all about.

New technology, in particular fracking, has been very bad news for the oil
companies bottom line even if it's good new for the economy as a whole.


John K Clark

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RE: Natural gas: The fracking fallacy

['Chris de Morsella' via Everything List]

 

 

From: everything-list@googlegroups.com 
[mailto:everything-list@googlegroups.com] On Behalf Of zibblequib...@gmail.com
Sent: Sunday, December 21, 2014 11:53 AM
To: everything-list@googlegroups.com
Subject: Re: Natural gas: The fracking fallacy

 



On Sunday, December 21, 2014 6:40:21 PM UTC, John Clark wrote:

On Sat, Dec 20, 2014  'Chris de Morsella' via Everything List 
 > wrote:

 

>> In depth article in Nature warning against the current unfounded euphoric 
>> optimism regarding the scale of the future supply of shale gas (&oil).

 

The fact that just 5 years ago NOBODY predicted the huge increase in oil and 
gas production that occurred doesn't exactly fill me with confidence that those 
same experts who got it so wrong 5 years ago have got it right this time.  

John – Definitely *NOT* the same experts who got their hyper optimistic 
assumption predictions  so terribly wrong. This is pure misdirection on your 
part; not worthy of any response other than to point out that it is an attempt 
to misdirect. Don’t talk about the facts of the findings; throw up some 
irrelevant string of verbiage implying that these are the same set of 
researchers who produced the inaccurate future reserve and production 
predictions that were used by the shale sector to get Trillions of dollars of 
easy (Fed quantitative easement fueled) credit (much of which the tax payer may 
be on the hook for when this bubble blows up in our face)

Just like I mentioned around six months or so ago – the smart money is already 
fleeing the shale sector in the US and in fact if you look at how interest 
rates for junk bonds for drillers etc. have recently shot up, the picture 
becomes clear. It is a classic bubble and it is about ready to blow – will it 
sink the global economy with it?

Chris

 

  John K Clark

 

I aim to be in the fracking business by the year after next. For the past few 
months and foreseeably another 18 months I've been using things like forex 
spreadbetting as an objective basis for prediction construction using my theory 
of something that can be 'run' and followed up with analysis and testing. 
Basically the obvious primary measure is profit. 86M USD up last looked. 

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Re: Natural gas: The fracking fallacy

[zibblequibble]

On Sunday, December 21, 2014 6:40:21 PM UTC, John Clark wrote:
>
> On Sat, Dec 20, 2014  'Chris de Morsella' via Everything List <
> everyth...@googlegroups.com > wrote:
>
> >> In depth article in Nature warning against the current unfounded 
>> euphoric optimism regarding the scale of the future supply of shale gas 
>> (&oil).
>>
>  
> The fact that just 5 years ago NOBODY predicted the huge increase in oil 
> and gas production that occurred doesn't exactly fill me with confidence 
> that those same experts who got it so wrong 5 years ago have got it right 
> this time.  
>
>   John K Clark
>
 
I aim to be in the fracking business by the year after next. For the past 
few months and foreseeably another 18 months I've been using things like 
forex spreadbetting as an objective basis for prediction construction using 
my theory of something that can be 'run' and followed up with analysis and 
testing. Basically the obvious primary measure is profit. 86M USD up last 
looked. 

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Re: Natural gas: The fracking fallacy

[John Clark]

On Sat, Dec 20, 2014  'Chris de Morsella' via Everything List <
everything-list@googlegroups.com> wrote:

>> In depth article in Nature warning against the current unfounded
> euphoric optimism regarding the scale of the future supply of shale gas
> (&oil).
>

The fact that just 5 years ago NOBODY predicted the huge increase in oil
and gas production that occurred doesn't exactly fill me with confidence
that those same experts who got it so wrong 5 years ago have got it right
this time.

  John K Clark

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RE: Natural gas: The fracking fallacy

['Chris de Morsella' via Everything List]

In depth article in Nature warning against the current unfounded euphoric 
optimism regarding the scale of the future supply of shale gas (&oil). This is 
a long in depth article based on a Texas study that has taken a much finer 
grained look at reserves than the EIA did and based on their much finer grained 
data has come to a very much more pessimistic outlook than the naïve (bordering 
on the unethical and dishonest, IMO) boosterism of the EIA. Quoting from 
somewhere in the middle of the article is the crux of how the very different 
set of projections were produced.

Here is a link to the full article in the journal Nature: 
http://www.nature.com/news/natural-gas-the-fracking-fallacy-1.16430

 

“The main difference between the Texas and EIA forecasts may come down to how 
fine-grained each assessment is. The EIA breaks up each shale play by county, 
calculating an average well productivity for that area. But counties often 
cover more than 1,000 square kilometres, large enough to hold thousands of 
horizontal fracked wells. The Texas team, by contrast, splits each play into 
blocks of one square mile (2.6 square kilometres) — a resolution at least 20 
times finer than the EIA's.”

 

Resolution matters because each play has sweet spots that yield a lot of gas, 
and large areas where wells are less productive. Companies try to target the 
sweet spots first, so wells drilled in the future may be less productive than 
current ones. The EIA's model so far has assumed that future wells will be at 
least as productive as past wells in the same county. But this approach, Patzek 
argues, “leads to results that are way too optimistic”.

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