Government Forcing Gas Prices Up So We Go Green?

[Shadowrider]

I don't think it's anywhere near $15 a barrel. The lifting cost is more than that. According to Moody's the break-even point is about $42 a barrel industry wide. I don't think Permian is that far off.

Some analysts peg the ballpark break-even of pulling oil out of the West Texas ground at $35 to $40, making it one of more cost-effective energy plays in the United States

I think Ace is pretty close here.

There are about 50 bazillion variables involved with profitability in the O&G sector and every company has their own number. It all depends on the geology, lease acquisition costs and 50 bazillion (minus 2) other things. Some companies are getting really good at saving money, but shale drilling is just mega expensive to begin with. Continental Resources is probably the king at well engineering, with Devon and Chesapeake doing some good work too.

 

[okietool]

My guy at Chevron says $10 for them, I know ours is a little higher than that According to what I have been told by some of our management team.

That number surprised me also. I'm guessing that's at the well head, not at the refinery.

The oil wells I have kept track of are making about 45-50 bbls oil per hour and only about 30-35 bbls water. I'm not sure what the life will be, but I know one of the bigger producers is about 2 1/2 years old.

Right now those are costing about a million to drill and about the same to complete. But those are not final costs, there are discounts, etc. that I do not see.

Actually, the laterals in the shale drilling aren't very expensive to drill, 2000' to 2500' per day is pretty much reachable in the Woodford. The intermediate hole in central Ok. is where the expense is, good days there are still over 1000' / day average.

In Bone Springs wells in the Delaware Basin it's not the same. You can drill a 12000' well with a 4500' lateral in about 10 days.

There are a lot of variables, but I would guess anyone still drilling has most of those on a tight rein.

If the company is servicing a lot of debt, the overhead could be significantly higher.

I don't see the numbers, I just hear them at meetings. Plus my sample is pretty small.

As far as the engineering goes, every area has a different superstar and none of them reign forever. Good engineering is nice, but wellsite supervision is what make the difference. Witness Tenneco. At one time they had a pretty legitimate claim to be the best engineered oil company in the world IMO.

Didn't Clinton release some oil from the strategic reserve to knock the price of oil down once?

I can't see the point of doing that now.

I wonder what's the average price of the oil in strategic reserve?

The goobermint could take barrels of oil instead of money for leases etc. or at least as partial payment, that would keep the reserve pumped up.

Edit: Right now if I had to pick the king of engineering, it would be K&M Technologies. At least in the U.S.

 

[Hobbes]

https://www.iea.org/oilmarketreport/omrpublic/currentreport/