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The U.S. tight oil sector, particularly the Permian Basin, borrowed half a trillion dollars to drain America as fast as possible, for oil exports. Below costs. It ate the heart of its watermelon within 12 years...for 8 % recovery rates of oil in place.
Its lost $200B, already, and is still another $200B in long term debt with well productivity cratering, WOR skyrocketing and oil prices below
$55 per barrel.
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“The secondary zones in the Permian have 15 to 20% less reserves by our observation,” the survey respondent said. “Make no mistake, these are economic locations, but we view secondary zones as unable to keep up with global crude oil demand in the next 5 years. Hence, why we are seeing larger independents make forays into Turkey, Argentina, and the like. Dallas Fed Survey
I'd like to say about the chart, above, you can't argue with 15 years of historic precedence in realized production data... but of course you can. Internet experts do it every day. In this case above those internet ANALysts believe that because Delaware Basin HZ wells are getting gassier year after year, they will have higher EUR's than in the past and provide long term feedstock for America's LNG industry, that just exported 100 million tons of LNG for the first time in History last month, by the way
But it's not correct. Higher initial GOR's do NOT translate to greater EUR's If anything they may imply a more mature state of pressure depletion for associated gas from tight oil wells and make LESS gas. That is, in fact, correct.
This data set of wells, above, in ten years, declined from 3 MMCFGPD down to less than 140 MCFGPD. They are a course to make 2.5 BCF of associated gas in probably 15 years. Drill THAT with $10MM HZ wells using your own money.
Those EUR's won't get bigger over time, they will get smaller.
Associated gas from Permian tight oil wells as a part of the 100 years of supply scam is about 6 or 7 on the whoppers the tight oil sector has said about itself the past 15 years. Be careful.
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The materials provided on this site are for informational and educational purposes only and are not intended to provide tax, legal, or investment advice. I may make data related mistakes occasionally; if you use my opinions about oil reserves or shale well economics for financial purposes, to buy or sell stocks, your nuts. Don't do that. If I have used a photograph incorrectly it was for educational purposes and I have done my best of to give credit where credit is due. My stories are all true, slightly embellished, perhaps, but true; I don't change names to protect the guilty. I am as accurate as possible about history and historical facts; I work very hard at that.All rights are reserved, whatever that means. Don't blame me, I didn't do it.
