Quark has done an excellent analysis of the report . Suggest you keep a bottle of booze close by . Read comments . Spanish ---use Google translate .

https://futurocienciaficcionymatrix.blogspot.com/2024/08/el-informe-exxon.html

From the comments section of the above .

'' We passed the peak, just as predicted, back in 2005. But the real issues is that the cheap oil was already in short supply. We are so addicted to oil that we chase after other things and turn them into oil. The Canadian Tar Sands are a case in point. Their dirty little secret is that the have to add tons of hydrogen to even approximate a hydrocarbon. And where do they get all that hydrogen? From natural gas, a perfectly good and clearer energy source. As one journalist called it, "they turn gold into shit". Remember all those flares at oil refineries, they used to just burn off the natural gas. It too will be gone in few more years. But we will be drilling baby drilling according to Trump long after the the thermodynamic net loss sets in.''

Good morning Mike.

I was reading up on the GTA project offshore Senegal/Mauritania yesterday. It is quite the mind screw to consider the technical issues being overcome and investments being made for 650 MMcfd of gas sales when more than that is wasted in the PB right next to infrastructure.

That is some perspective.

Tomorrow always comes.

Insiders know something about the Permian, the algos keep pushing down the price and it keeps poping up

That is some good perspective, thank you. Like Guyana...estimated URR to date: 11 G BO. At the end of 2025 the U.S. will have exported about 13 G BO to foreign countries.

There is NO way of knowing how much associated gas is being flared in the Permian right now with WaHa negative $4 to Henry or Houston...I'm gonna bet at least 1.5 BCF per day. Its likely much more. Sombody told me the other day 2 BCF. The Matterhorn line coming on will not reduce that much, IMO...remember more gas takeaway via the Matterhorn has been the great promise for more Permian tight oil.

400K BOPD more in 2024 and another 600K BOPD more in 2025, so says everybody, so all this will sort itself out by the end of 2025 or mid 2026 when the drill baby drill plan is fully underway...1 MM BOPD will drive the price down to $58, or less and then everybody will be going back to the house. Again.

Mike,

Do you have any ballpark numbers on per barrels water disposal costs? It obviously is a wide range but it would give me some perspective.

Additionally, have you any information on HZ wellbore cleanout operations cost and results? Years ago I told you about the P trap nature of our 3,000 ft Bakken laterals and translating that to 10K to 15k ft laterals in depleted rock would in no way be a linear extrapolation.

I was retained about a year ago to study water costs in the Delaware and got to spend 2 months on it before getting shut down because of funding. It ranges so vastly over, for instance the Delaware, it's amazing, from $2.50 to $6.60 per BW. The higher end was a direct result of longer hauls away from SRA's near Toyah, for instance, where all the rumbling was going on. Figure $1.00 -2.00 at the SWD but the hauls can sometimes add $4.85 per BW depending on how long the trip and how long the wait to dump. When they shut down SRA's there can be 4 hour waits 80 miles down the highway where everybody else has to go. You know what a vacuum truck costs an hour, from yard to yard.

Water costs eat their lunch. The $4-7 per incremental BO of lift cost hooey is just that...before down maintenance costs are included I think lift costs are plus $15, or more, including G&A.

I am not learned enough to answer the second question save to say I don't think there is a whole lot of CT clean out work on the longer lateral unless where efficiency of lift mechanisms are down to 50% or less. Small privates are better operators than bigger independents because the bigger boys are brain locked on 900 BOPD IP's and maximum cash flow. The smaller guys spending their own money watch pump, or lift efficiency numbers.

Associated gas at plus $2.50 is a big deal as that covers lots of operating costs. When natas is less than 50 cents, or worse, it hurts a lot more than those dudes will admit.

I'd like to say one more thing I learned about water in the Permian...the 60-70% reuse, or recycling for frac source water is a lie. Its 40-45%, at best. And the longer the laterals the more water that is required to pump more dirt in denser perforation clusters. The rest of Texas is threatened by declining groundwater and surface water, along the Rio we are fighting with Mexico over water...they use it out there in West Texas to frac with like it will last forever. 6.1 MM BOPD/4.1MM BOPD crude oil exports (93-94% of which comes from the Permian) =68%.

Drill Baby, Drill will forever render this part of Texas uninhabitable within 10-15 years, IMFUO.

Bien, merci!! Je vais le lire.

Laherrere's article was also posted at Quark's site . Some comments of interest by Quark .

1.Laherrere is not just any oil analyst. He worked for 37 years at TOTAL and in 1991 he devoted himself mainly to studying the exploration and production of conventional oil, until in 1998 he published the first modern analysis, together with Colin Campbell, "the end of cheap oil".

Like everyone else, he underestimated the impact of shale oil, but he is a leading authority in the world of conventional oil.

Of course, his forecast should be taken as an important reference, but not as an absolute certainty. In fact, I maintain my roadmap and with the projects in development, I do not believe that conventional oil will begin a serious decline until around 2030.

What is striking about the report is that Laherrere thinks that OPEC's cuts are not voluntary, but driven by exhaustion. And he establishes a much more aggressive forecast than the previous one from 2018, in direct contrast to the IEA's forecasts.

I still think that oil producers will maintain supply at all costs, even assuming a very rapid depletion of reserves, which will prolong the start of the abrupt decline for a few more years. Then geology will dictate the verdict...

Comment 2

I think Theoildrum's analysis was not so far off. It did not take into account the desperate attempt to maintain production at the cost of depleting reserves, thus minimizing the expected decline. The bell-shaped Gaussian curve that Hubbert observed has turned into a Seneca cliff. Although we are still on the long plateau, we know that the decline will be rapid and it will not matter much whether it starts in 2025 or 2030 .

HIH,

Having looked at the report and graphs, to the extent that I could, I was more than a bit concerned. The general public, and sometimes oil folks, look at ME supply as a zero decline rate constant.

There are many questions beyond the scope of his notes and this blog which come up. Of real import is the effect on data points of supply disruptions and/or manipulations by SA, Iran and Iraq. Embedded in some of those are the under exploration and deterioration of production and equipment for lack of foreign inputs for political reasons. These all add to noise in the graphs that draws the curve fit to the critical side. In no way am I qualified to speak on the subject but I can wonder. At any rate, declines comes but when and how drastic?

Some time ago, I noted here that the LTO phenomenon actually aggravated the slope of the supply falloff because it masked the global conventional decline. Once the LTO peters out to a larger extent, in the PB for example, we will see that the emperor is wearing no clothes. It did not have to be this way and Mike laid that bare today.

Again, it is so negligent it almost looks like a plan to me.

Thank you, Gerry. I hate politics and I hate lying for the sake of a vote. If I were to scrutinize lies said this week in Chicago I'd never have time to go fishing. It was awful.

I am an oil man; thats all... with a lot of experience and its important that Americans not get their hopes up over reducing the price of oil enough to be able to pay off the credit cards, or buy a house. It can't happen. We have to vote for the right folks, for the right reasons.

Mother Nature will take care of this Drill Baby, Drill dog dookey. On Her time, in Her way.

It's already happened, HIH, just watch ten minutes of the Democratic Nat'l Convention.

You made it to 10??!!!! Wow. I am impressed. I could only do 5.

Gerry , at the risk of being flagged by Mike . It was a freak show . When did US become illiterate ? Can't tell the difference between being someone from the Indian subcontinent and Africa ?

USA = United States of Amnesia ---- Gore Vidal

Disclaimer ; - I don't have a vote being a foreign national . Be well .