Hart Energy - Hart Energy

Hart Publications is the most messed up, bias source of oil and gas information in the country. My friend, Anne, the midstream Sr. VP here, sent me this with the caveat it was "like reading The Onion."

DUG Permian Conference - Hart Energy

Its DUG week in the Permian Basin and as you might expect, those shale oil dudes are puckered up with oil prices at $54 WTI at the well head and associated gas maybe a buck, at best. So, everybody gets together, preaches their sermons about how good things still are, makes their press releases and do their interviews, like, to Hart. then go drink together scared out of their heads, trying to muster courage and pump themselves up.

By day three the horse shit gets really, really bad. Hart is there.

With Trump talking about Greenland, and all of the wild estimates of oil up there, I figured I would glance at it. The US Geological Survey (USGS) did a probabilistic study so make of that what you will. It's more SWAG than substance.

Anyway, the USGS thinks that the Arctic is gas prone, with most of the gas in Russia. Gas volumes are enormous. About 1/3 of the Arctic oil is undiscovered oil in Alaska. Probably there is another Prudhoe Bay up there, and less probably, more than that. Greenland tried attracting oil money. They drilled in offshore West Greenland and came up with zilch. Ditto East Greenland. There is no onshore oil anywhere in Greenland or Eastern Canada due to the Canadian Shield. Overall, there is enough oil in the Arctic to provide the world about 1-5 years of oil. That is enough to incentivize exploration, but it i…

I was just wondering if anyone else had heard of this book. The author was a reservoir engineer, and describes the fight between engineers and geologists for control of the right to estimate proven reserves. He thinks oil reserves are overestimated by 50%, so for every three barrels of oil estimated, only two will actually flow, The only exception is Russia, where the overestimate is 200%, i.e. for every three barrels estimated, only one barrel will flow. In other words, divide by three. He also thinks that the shale revolution can be better described as the siltstone revolution. The crux of his argument is that geologists include oil reserves from low quality rock that will never flow.

Comments? I find it interesting and decided to throw it out for discussion.

After a tough day for stocks and especially oil stocks, I’m wondering if this could be a tipping point. Right now rig count fell again this week but falls more next week is my guess. As companies are preparing 2026 budgets this latest rout can’t be good. My problem is I don’t think any of it is real. In theory, investing at the point of maximum pessimism seems easy. In practice, it’s incredibly difficult.