Chris Martenson posted this comment on his website. It paints a clear picture at the types of investment(s) and commitments it takes to extract oil out of the ground. This is all going to end pretty much as Gail Tverberg has said that we will reach a point where oil must be sold at a minimum price and that price will be much too high for the consumer, so it stays in the ground. Michael Rupert who made the Movie Collapse was also of this belief.
” was just speaking yesterday with a gentleman with 40 years of experience in the oil services business. He operated all over the world, from the North sea, to the Middle East, Africa, and all over the US.
His assessment of the ANWR oil was based on having also worked there putting in man camps, delivering water and oil tanks and other services.
He said, point blank, “They could give that lease land away, and remove every possible fee or tax and it still wouldn’t get drilled. The price of oil is too low.”
Bang! There it is.
His reasoning was that there’s no infrastructure up there. No roads. No electrical lines. No pipelines. No conditioning plants. No welding shops. No restaurants. Nothing.
You have build or bring everything to the show.
By way of example, he said “Just consider the man camps, which were a focus of mine. To build out a 400 person facility is at least $15 million. That’s about what you’d need for a mid-sized operation. We can’t fly all that in, so we have to build roads. In that part of Alaska you have to hug the coasts so you have something solid under your trucks. Alternatively you have to wait for the right temperatures and then build ice roads. Depending on condtions and topography those costs range from heavy to extreme. So who pays for that? If you’re asking my company to do that, and we did, we need contracts that both cover our costs and reasonable profits. At a minimum those are 5 year contracts. After Biden, who is going to sign a 5-year contract to build something that might be zeroed out by the next administration?”
That wasn't the point he was making. His comment merely showed the insane levels of money, infrastructure, and commitment it takes to get oil out of the ground. Whether oil is there or not doesn't matter. He would not bother setting up shop to extract it, if it was there.
Lets take away the oil, and really get the party started.
When it finally happens, I suppose most people will have no idea why they are at each others throats, and will blame their neighbour... just like the rats in an electrified cage.
You are a certified fucktard. You have the fucking ability to turn a conversation about Dogs and somehow make it about Cats. I am thru dealing with a dumbass like you.
Somehow you seemed as usual because you are too fucking stupid to read, that the discussion was based on the amount of investment required to extract oil, "not whether there's oil there or not".
“I would say ANWR falls in that high risk, high potential — not high risk of oil, but high risk of execution,” he said. “When you put it all together, will that attract somebody? I think it will.”
We are burning the industrial civilization (IC ) candle at both ends: through the artificial man made construct of debt and through the natural laws of physical thermodynamics of energy cost of energy (ECoE) / energy returned on energy invested (EROEI).
Producing oil coal or NG is a complex specialized task that requires a form of money as a medium of exchange to coordinate drilling , refining, maintenance, and transport.
When the financial system crashes, then so does the specialized interconnected industry needed for extracting energy. When it costs more energy to get that barrel of oil out of the ground than that same barrel provides, then the system also crashes.
Natural resources will run out before man-made constructs, like debt and money, will ever collapse. Why? Because we are masters of made-up concepts, but nevertheless unable to change hardcore reality.
Im watching Landman right now. It delivers truth bomb after truth bomb... and precisely explains why it is essential for the price of a barrel of oil remain within a tight range. Once it falls out of range, it spells disaster. The kicker is, they all know this will happen, but need to keep it going for as long as they can.
Yes! When we had cheap energy, the cost was low for what energy producers got in return. That was 50-75 years ago. Now it is offshore, shale, tar sands and other hard to get at oil. That cost lots of money in infrastructure and investments. That gets passed on to the consumer who already is spread thin enough and they are spread thin because we lack the cheap affordable energy to provide a lower cost way of living.
The further out, or down, and the less dense the returned energy is.... the less value there is in taking the risk. When your oil isnt enough to make up for the difference... in a declining oil energy situation, then the price falls even faster as the economy can no longer afford it.
This is the trap. Its probably why almost nothing is being developed, except by government owned organisations.
Edit: As an interesting metaphor on this, there was a recent article somewhere about how hard it was to initially climb Everest. The biggest reason being not climbing the hill, but building incredibly complex supply lines required to make it happen. It wasn't just dozens of people... it was hundreds and thousands. The same situation occurs for any great event. Now that the supply lines are there, well, almost anyone can climb the mountain. I suspect there will be no one climbing Everest in 5 years time.
Probably a good idea to work out how to die by the end of the year... I would but I want to be around to watch the most vile stupid species ever -- to extinct
As an ancient buzzard who holds clear memories of life in the USA in the 1950s (and onward), my take is that the absolute indoctrination of Norteamericanos is such that denial or some cheap miracle fix will endure until the absolute last moment... and our [useless] leaders, not valiant enough to pop the bubble, will go along with it, even when they can see us heading over a cliff, Cliff. Compare that sealed state of mind to that of the Japanese, who traditionally lived on the edge of survival, and whose elemental outlook on behavior is eminently practical. An example of that is their humiliating loss in World War II: unlike the guilt-ridden Germans, the Japanese scorn the Imperial effort because it was so impractical, guaranteed to end in disaster. An eye on survival does that to you: you obsess on That Which Works. Euros may be slowly coming around to a groggy awakening; Americans are still deep-dreaming. So many of my bright, successful friends in Texas are sorry case studies in this syndrome.
Nope. Look at the Bakken and Eagle Ford - Bakken is still producing 85% of the peak a few years ago and Eagle Ford is still producing 50% of the peak from 10 years ago (graph doesn't show the recent dip).
In the volatile world of U.S. natural gas, the past quarter unfolded with all the drama of a Shakespearean act. Prices began at a modest $2.60 per Mcf, buoyed by the quiet equilibrium of early spring. But by mid-June, the plot had transformed. An unseasonal heat wave gripping the central United States sent prices soaring to $3.15, a rally that spoke as much to the market’s sensitivity as it did to the hot weather. Yet, as quickly as the heat arrived, it receded. Milder temperatures reclaimed the stage and gas prices tumbled in response, bottoming at $1.90 by the end of August.
While market participants obsessed over weather patterns, few paused to consider the silent protagonist in this unfolding drama: inventories. The 2023–2024 winter, among the warmest on record, left a legacy of near-record storage levels. At the outset of the injection season, inventories stood at a staggering 700 Bcf—or 40%— above the ten-year average. Yet, tight fundamentals have nearly erased this surplus in a remarkable turn. Over the third quarter alone, inventories were drawn down by almost 400 Bcf. By quarter’s end, storage levels stood less than 5% above the norm, a quiet but profound shift that few have fully grasped.
This brings us to the present moment, where the market stands at a crossroads. If the coming winter delivers typical cold—after two years of unseasonable warmth—U.S. natural gas prices could well align with international benchmarks which currently hover near $14/MMBtu. The implications are vast, mainly as U.S. natural gas production, once seemingly boundless, now hints of rolling over.
Over the past fifteen months, growth in U.S. gas production has stalled. Indeed, in the past seven months, production has begun to contract. Since peaking in December 2023, U.S. dry gas supply has fallen by 3 Bcf per day—a 3% decline. Year-over-year data tells a similar story, with dry gas production now down by 1.2 Bcf per day, slightly more than 1%.
Oh? Europe and the UK are on the verge of collapse due to having to pay through the nose for LNG.... and with a decline in US production guess which direction gas prices are headed...
I've never met an American in America who has questioned the narrative of being exceptional. If I meet an expat American here in the UK I make a point of asking how long it took them to see the story for what it was. That question always elicits a big smile.
Apart from condescending insults (which may or may not be deserved), what is your response to (otherwise quasi-intelligent) people who are true believers that (1) [so-called] “fossil fuels” are NOT derived from formerly living organic matter and (2) “the peak oil idea has been parroted for decades, like global warming and sea level rise”?
Fast Eddy ... no longer in New Zealand says... anyone who believes fossil fuels are abiotic or somehow replenishing.... is a mentally retarded moron.
If they replenished then we'd not be steaming oil out of sand or dropping bombs into thousands of holes -- blowing up the rock formations - and sucking up the dregs
It IS “obvious”. Why else would it be getting way more expensive to extract oil??
One of the quasi-intelligent Substack authors to reply to a comment I made on Peak Oil wrote “There’s no evidence, operationally, that we’re teetering on the edge of failure. Nobody claims infinite supply [or] limitless rate of supply. Only that the supply is adequate. Plenty of evidence that indicates that the powers that shouldn’t be aren’t faintly concerned about running out [of] ‘fossil’ fuels (they’re not derived from formerly living matter) or it’s rate of supply. They could have easily created circumstances in which the rate of consumption of fuel would be less than it is. But 2024 was yet again a record year for production and consumption.”
I referred him to your Substack and to the research of Dmitry Orlov and James Howard Kunstler and Gail Tverberg, seeing that I don’t know how to present compelling evidence and logical fallacy-free arguments.
I've interacted with Mike many times...he also states there us no overpopulation problem....ask him why we drop bombs into thousands of holes blow up the shake rocks and suck up the dregs of dead oil fields if there is so much easy oil remaining
Yeah, it’s pretty obvious that when oil companies are steaming oil out of tar sands and are exploding rock formations to suck up the dregs of the oil in previously tapped wells that the oil fields are becoming exhausted, where the oil is cheaply and easily extracted. Plenty of people refuse to abandon their irrational hopium, when it comes to industrial civilization continuing apace for the children of today being able to have grandchildren. These people can’t imagine any other scenario. Maybe they really are intellectually retarded.
Chris Martenson posted this comment on his website. It paints a clear picture at the types of investment(s) and commitments it takes to extract oil out of the ground. This is all going to end pretty much as Gail Tverberg has said that we will reach a point where oil must be sold at a minimum price and that price will be much too high for the consumer, so it stays in the ground. Michael Rupert who made the Movie Collapse was also of this belief.
-----------------------------------------------------------------------------------------------
” was just speaking yesterday with a gentleman with 40 years of experience in the oil services business. He operated all over the world, from the North sea, to the Middle East, Africa, and all over the US.
His assessment of the ANWR oil was based on having also worked there putting in man camps, delivering water and oil tanks and other services.
He said, point blank, “They could give that lease land away, and remove every possible fee or tax and it still wouldn’t get drilled. The price of oil is too low.”
Bang! There it is.
His reasoning was that there’s no infrastructure up there. No roads. No electrical lines. No pipelines. No conditioning plants. No welding shops. No restaurants. Nothing.
You have build or bring everything to the show.
By way of example, he said “Just consider the man camps, which were a focus of mine. To build out a 400 person facility is at least $15 million. That’s about what you’d need for a mid-sized operation. We can’t fly all that in, so we have to build roads. In that part of Alaska you have to hug the coasts so you have something solid under your trucks. Alternatively you have to wait for the right temperatures and then build ice roads. Depending on condtions and topography those costs range from heavy to extreme. So who pays for that? If you’re asking my company to do that, and we did, we need contracts that both cover our costs and reasonable profits. At a minimum those are 5 year contracts. After Biden, who is going to sign a 5-year contract to build something that might be zeroed out by the next administration?”
His assessment of the ANWR oil
There is no oil. No viable oil reserves there.
That wasn't the point he was making. His comment merely showed the insane levels of money, infrastructure, and commitment it takes to get oil out of the ground. Whether oil is there or not doesn't matter. He would not bother setting up shop to extract it, if it was there.
His comment merely showed the insane levels of money, infrastructure, and commitment it takes to get oil out of the ground
That's what no viable oil reserves means.
You are a fucking moron Withnail. I have no time to debate a fucking moron like you who believes the internet doesn't matter.
Time for a Cage Match - to the death
Uncle Eddy the misanthropic leader of Barter Town.
Uncle Eddy: And what did you do before all this?
Max: I was a permaculture guru with 3 daughters
Uncle Eddy: Well, how the world turns. One day a no-till, swale digger, next day a diesel punk wandering the desert after peak oil.
Lets take away the oil, and really get the party started.
When it finally happens, I suppose most people will have no idea why they are at each others throats, and will blame their neighbour... just like the rats in an electrified cage.
I'd beat him over the head with the internet, just to prove the point that it matters. The dude is the Cliff Clavin of your Substack
https://en.wikipedia.org/wiki/Cliff_Clavin
Do you understand what the word 'viable' means you incorrigible fuckwit?
You are a certified fucktard. You have the fucking ability to turn a conversation about Dogs and somehow make it about Cats. I am thru dealing with a dumbass like you.
Somehow you seemed as usual because you are too fucking stupid to read, that the discussion was based on the amount of investment required to extract oil, "not whether there's oil there or not".
https://alaskapublic.org/top-stories/2020-12-23/the-lease-sale-is-set-but-how-much-oil-is-actually-under-anwrs-coastal-plain
“I would say ANWR falls in that high risk, high potential — not high risk of oil, but high risk of execution,” he said. “When you put it all together, will that attract somebody? I think it will.”
We are burning the industrial civilization (IC ) candle at both ends: through the artificial man made construct of debt and through the natural laws of physical thermodynamics of energy cost of energy (ECoE) / energy returned on energy invested (EROEI).
Producing oil coal or NG is a complex specialized task that requires a form of money as a medium of exchange to coordinate drilling , refining, maintenance, and transport.
When the financial system crashes, then so does the specialized interconnected industry needed for extracting energy. When it costs more energy to get that barrel of oil out of the ground than that same barrel provides, then the system also crashes.
Debt and physics. Either way.
Natural resources will run out before man-made constructs, like debt and money, will ever collapse. Why? Because we are masters of made-up concepts, but nevertheless unable to change hardcore reality.
We will all have lots of money when the final collapse comes, but we will starve just the same.
So the issue is not reserves it’s the cost of extraction? Is that right?
Im watching Landman right now. It delivers truth bomb after truth bomb... and precisely explains why it is essential for the price of a barrel of oil remain within a tight range. Once it falls out of range, it spells disaster. The kicker is, they all know this will happen, but need to keep it going for as long as they can.
https://moviesjoy.skin/moviesjoy-series/landman-fneBeu/1/1
reserves in themselves really don't mean anything.
Yes! When we had cheap energy, the cost was low for what energy producers got in return. That was 50-75 years ago. Now it is offshore, shale, tar sands and other hard to get at oil. That cost lots of money in infrastructure and investments. That gets passed on to the consumer who already is spread thin enough and they are spread thin because we lack the cheap affordable energy to provide a lower cost way of living.
I ask because remote drilling seems to be a possible solution in some scenarios.
The further out, or down, and the less dense the returned energy is.... the less value there is in taking the risk. When your oil isnt enough to make up for the difference... in a declining oil energy situation, then the price falls even faster as the economy can no longer afford it.
This is the trap. Its probably why almost nothing is being developed, except by government owned organisations.
Edit: As an interesting metaphor on this, there was a recent article somewhere about how hard it was to initially climb Everest. The biggest reason being not climbing the hill, but building incredibly complex supply lines required to make it happen. It wasn't just dozens of people... it was hundreds and thousands. The same situation occurs for any great event. Now that the supply lines are there, well, almost anyone can climb the mountain. I suspect there will be no one climbing Everest in 5 years time.
Even a vax injured who's survived sepsis but has his arms and legs cut off... can climb Everest now ... if he has the $$$$$$$$$$$$$
Thanks for the troves of important information, Eddy. I'm sure your research does't come easy.
My conclusion: people better start dying on large scale.
Probably a good idea to work out how to die by the end of the year... I would but I want to be around to watch the most vile stupid species ever -- to extinct
Don't worry, they will.
As an ancient buzzard who holds clear memories of life in the USA in the 1950s (and onward), my take is that the absolute indoctrination of Norteamericanos is such that denial or some cheap miracle fix will endure until the absolute last moment... and our [useless] leaders, not valiant enough to pop the bubble, will go along with it, even when they can see us heading over a cliff, Cliff. Compare that sealed state of mind to that of the Japanese, who traditionally lived on the edge of survival, and whose elemental outlook on behavior is eminently practical. An example of that is their humiliating loss in World War II: unlike the guilt-ridden Germans, the Japanese scorn the Imperial effort because it was so impractical, guaranteed to end in disaster. An eye on survival does that to you: you obsess on That Which Works. Euros may be slowly coming around to a groggy awakening; Americans are still deep-dreaming. So many of my bright, successful friends in Texas are sorry case studies in this syndrome.
Shale was that miracle. And it's about to come crashing down
Nope. Look at the Bakken and Eagle Ford - Bakken is still producing 85% of the peak a few years ago and Eagle Ford is still producing 50% of the peak from 10 years ago (graph doesn't show the recent dip).
https://static.wixstatic.com/media/8cc98c_1be51e4125794163918a2332b994ce43~mv2.png/v1/fill/w_465,h_484,al_c,q_85,usm_0.66_1.00_0.01,enc_avif,quality_auto/8cc98c_1be51e4125794163918a2332b994ce43~mv2.png
Natural Resources Market Commentary - Q3 2024
Goehring & Rozencwajg Natural Resource Investors
In the volatile world of U.S. natural gas, the past quarter unfolded with all the drama of a Shakespearean act. Prices began at a modest $2.60 per Mcf, buoyed by the quiet equilibrium of early spring. But by mid-June, the plot had transformed. An unseasonal heat wave gripping the central United States sent prices soaring to $3.15, a rally that spoke as much to the market’s sensitivity as it did to the hot weather. Yet, as quickly as the heat arrived, it receded. Milder temperatures reclaimed the stage and gas prices tumbled in response, bottoming at $1.90 by the end of August.
While market participants obsessed over weather patterns, few paused to consider the silent protagonist in this unfolding drama: inventories. The 2023–2024 winter, among the warmest on record, left a legacy of near-record storage levels. At the outset of the injection season, inventories stood at a staggering 700 Bcf—or 40%— above the ten-year average. Yet, tight fundamentals have nearly erased this surplus in a remarkable turn. Over the third quarter alone, inventories were drawn down by almost 400 Bcf. By quarter’s end, storage levels stood less than 5% above the norm, a quiet but profound shift that few have fully grasped.
This brings us to the present moment, where the market stands at a crossroads. If the coming winter delivers typical cold—after two years of unseasonable warmth—U.S. natural gas prices could well align with international benchmarks which currently hover near $14/MMBtu. The implications are vast, mainly as U.S. natural gas production, once seemingly boundless, now hints of rolling over.
Over the past fifteen months, growth in U.S. gas production has stalled. Indeed, in the past seven months, production has begun to contract. Since peaking in December 2023, U.S. dry gas supply has fallen by 3 Bcf per day—a 3% decline. Year-over-year data tells a similar story, with dry gas production now down by 1.2 Bcf per day, slightly more than 1%.
https://fasteddynz.substack.com/p/natural-gas-production-is-contracting
I am showing oil production and you replied with something about natgas, when natgas is less of a concern.
Oh? Europe and the UK are on the verge of collapse due to having to pay through the nose for LNG.... and with a decline in US production guess which direction gas prices are headed...
If you want to discuss oil production have a look at this https://ourfiniteworld.com/2024/09/11/crude-oil-extraction-may-be-well-past-peak/
Refusal to buy cheap Russian piped gas is not proof of lack of available piped gas
I've never met an American in America who has questioned the narrative of being exceptional. If I meet an expat American here in the UK I make a point of asking how long it took them to see the story for what it was. That question always elicits a big smile.
the Japanese scorn the Imperial effort because it was so impractical, guaranteed to end in disaster.
They had no choice, the US started the war against them.
Hey Fast Eddy (in New Zealand). 😊
Apart from condescending insults (which may or may not be deserved), what is your response to (otherwise quasi-intelligent) people who are true believers that (1) [so-called] “fossil fuels” are NOT derived from formerly living organic matter and (2) “the peak oil idea has been parroted for decades, like global warming and sea level rise”?
Fast Eddy ... no longer in New Zealand says... anyone who believes fossil fuels are abiotic or somehow replenishing.... is a mentally retarded moron.
If they replenished then we'd not be steaming oil out of sand or dropping bombs into thousands of holes -- blowing up the rock formations - and sucking up the dregs
I would have thought that was obvious
It IS “obvious”. Why else would it be getting way more expensive to extract oil??
One of the quasi-intelligent Substack authors to reply to a comment I made on Peak Oil wrote “There’s no evidence, operationally, that we’re teetering on the edge of failure. Nobody claims infinite supply [or] limitless rate of supply. Only that the supply is adequate. Plenty of evidence that indicates that the powers that shouldn’t be aren’t faintly concerned about running out [of] ‘fossil’ fuels (they’re not derived from formerly living matter) or it’s rate of supply. They could have easily created circumstances in which the rate of consumption of fuel would be less than it is. But 2024 was yet again a record year for production and consumption.”
I referred him to your Substack and to the research of Dmitry Orlov and James Howard Kunstler and Gail Tverberg, seeing that I don’t know how to present compelling evidence and logical fallacy-free arguments.
Well.. cnnbbc told him that ... so he believes that.
I'd wager quite a few $$$ that he's Vaxxed
Ever heard of Dr Mike Yeadon? Anyway, that is his position.
I've interacted with Mike many times...he also states there us no overpopulation problem....ask him why we drop bombs into thousands of holes blow up the shake rocks and suck up the dregs of dead oil fields if there is so much easy oil remaining
Yeah, it’s pretty obvious that when oil companies are steaming oil out of tar sands and are exploding rock formations to suck up the dregs of the oil in previously tapped wells that the oil fields are becoming exhausted, where the oil is cheaply and easily extracted. Plenty of people refuse to abandon their irrational hopium, when it comes to industrial civilization continuing apace for the children of today being able to have grandchildren. These people can’t imagine any other scenario. Maybe they really are intellectually retarded.
He's obviously a retard. Don't waste your time with him.
I agree.