Caracas https://oilprice.com/Energy/Energy-General/How-the-US-is-Handing-Over-Venezuelas-Oil-Sector-to-China.html Venezuela has more proven oil reserves than any other country on the planet, most of them mid-sulfur, mid-gravity reserves in the Orinoco Basin. Perhaps less than 20% of these proven reserves have actually been produced since 1960. There might be as much as 100 G BO in that basin, and its good stuff. Orinoco reserves were one of a very few reasons U.S refinery capacity along the Texas and Louisiana Gulf Coasts were configured the way they were 70 years ago, to facilitate the use of this Venezuelan heavy oil. It is why America cannot process light, tight oil from unconventional resources here in the U.S. Somewhere along the way the United States thought it would teach Venezuela a less about democracy and sanction its ability to export heavy oil to the U.S., or the rest of the world, and starve the people of that country into NOT voting for Chavez, then Maduro. It was essentially American arrogance and entitlement. One of the biggest leaders of this movement to sanction Venezuelan oil was America's great shale oil hero, the famous "wildcatter, Harold Hamm. * Google that for me, please. It's a fact. Most people in Venezuela don't even know what communism is and don't vote. When they do vote they vote for whom they are told to vote for fear of being taken out and gunned down like dogs. The U.S. is too stupid to understand this so it can only force the people of Venezuela into eating house pets, or flamingoes off the lake... in the hope they will succumb to the American way of thinking and vote properly. I've been to Venezuela, a number of times, by the way, as late as 2009 on a mission to get friends OUT. Most of this policy towards Venezuela is based on the false premise of shale oil abundance, * that we would never need heavy oil from Venezuela because we had...Wolfcamp shit from the Permian. Or Bakken shit from the Williston. I rank this energy policy blunder 2nd only to exporting Permian Basin light, tight oil to foreign countries, below costs. Now China is in the driver's seat, set to take over the world's largest oil reserves just 8,000 miles away from the Gulf Coast, while the U.S. gets deeper and deeper in debt producing tight oil, below costs, that has no value here in the U.S. and has to be exported. Stupid is as stupid does, Forrest liked to say.

I've been picking on Chevron lately, so I am not going to make a featured post of this event save to say about the time it was announcing layoffs in the Permian Basin back in April, this Niobrara incident occurred in the DJ Basin in Colorado. You can tell pretty much what has happened by looking at this photograph, above. Within a soundproof enclosure there are 8 or 10 Niobrara well heads all line up in row already on production. The last two in the series have just been zip frac'ed, or simu-frac'ed. The workover rig to the rig of the well, facing 14:00, has laid her derrick over after landing production tubing in the casing head. I know none of this means much to anybody, it's just interesting. Something has occurred between landing the tubing and final nipple up of the production tree. There is enough information on the incident to, in fact, prove exactly that. Apparently as the tree was being picked up for making the flange-to-flange connection, the well assembly, was dropped knocking the disc (engagement ring) out of the tubing and the well came in. The production tree then fell over and fractured a hand's leg. The well is blowing up the tubing hanger in the casing head; all the pressure is induced, of course, from the frac and its mostly completion water being blown everywhere, probably from drilling frac plugs. But, as you can see, its already getting oily and, by the way, that ain't yellow snow piling up everywhere on the pad, that's frac sand. Gritty, abrasive and machine destroying. That white wire line truck off to the left will have to be completely rebuilt. It's extremely rare that a big company like Chevron would spill the beans on an incident like this, but it did, even to the extent of providing a diagram of the screw up when landing production tubing in the tree, all from 3rd party well servicing crews and the WH nipple up service, but under Chevron's supervision. This is really cool: One of the countless things that internet experts miss in the prediction of never-ending shale oil and shale gas is the fact that if another 6 month downturn sends 40,000 upstream hands to the house, that will be it for them. They have been thru leveraged, shale induced ups and downs so many times they can't stand to be sent home, with no pay, for another six months. They won't be back. Do you think anybody with oilprice.com understands that? Chevron was always a Boots and Coots client and I am sure B & C caught this job and was able to cap the blowout to the casing head, the well then killed and the tubing picked up and landed properly in the hanger, the well washed out, etc. before being put on production. I am speculating, of course, but in the photo below I see some white coveralls, a good sign. Weld County is highly populated and these Niobrara wells are essentially drilled in housing developments, etc. So though this was mostly water it caused a stir from concerned citizens, mostly because local TV channels and newspapers mentioned the word, benzene, which was highly unlikely even if the well blew completion fluid out of the hole AND frac flow back water. Still, everybody for several thousand feet around the production pad got their roofs pressure washed, and I am sure their houses repainted. All the horses, dogs and cats were attended to by vets and the entire mess caused Chevron a pretty penny. Pickups got detailed, replaced, all the equipment and engines had to be washed, their intakes cleaned of frac sand. It was a mess... but I've seen bigger messes, for sure. Like formation sand piled up as high as the racking board on the rig, 90 feet up. Everything in the oil business has risks, even mass manufacturing shale oil wells. There is nobody to blame, or point the finger at, nobody to sue; Lord knows, however, there is a bunch of that going on. Sometimes shit just, you know...happens. RAW: Residents Evacuate After Incident at Oil and Gas Site in Colorado My last B & C hardhat...

...the World has to read this sort of dookey: https://oilprice.com/Energy/Crude-Oil/The-Shale-Macro-and-Evolving-Production-Dynamics.html All shale 1Q25 earnings are based on wells that were drilled in 2H24, most of them before the November elections and under budgets that were set 1H24, and under long term rig and frac spread contracts. Lag time between reported rig counts and first reported production to the public in Texas can, and DOES, take six to seven months. "We now have a full quarter in the bank for these companies at subdued oil prices, and the message is becoming pretty clear. The upstream sector, while somewhat constrained in capital expenditure allocation—many companies are slowing their growth plans —is doing fine and generating more than adequate free cash to cover operational expenses, debt, and shareholder returns." Throughout 4Q24 WTI oil prices wandered around in the high $70's. They were hardly "subdued." Steel tariffs causing a 20% increase in D & C costs for shale wells were a figment of the imagination. When money is allocated, it needs to be spent, guidance needs to be met. WTI stayed in the mid 70's for almost the entire 1st quarter 2025. Only at the beginning of the 2nd quarter 2025 did Trump announce tariffs and trade wars and the price of oil dropped $15 a barrel. The quote, above, from the article, is incorrect. Now, 2Q25, prices are $20 lower and well costs are 20% higher. Rig counts in the Permian Basin, for instance, are down 25 plus since the first of the year, along with well completions. This will not show up in reported production until 4Q25. Whatever free cash flow was generated in 1Q, from activity in the field, six months ago, will be gone. By the way, "free cash flow" is a poor metric to use in gauging the health of the shale sector. The Permian Basin alone is still $178 billion stinking dollars in debt. It will take $90 WTI, sustained, to pay that debt back. There is NOTHING free about cash flow when you are $178 B in debt. Apache and Chord? WTF is Chord? Even Chevron and Exxon's earning in 1Q25 were down. Everybody in the shale patch is still adding debt. Diamondback's royalty wing just added another $5 B and EOG just added about $6 B. Let me slow way down and say, once again...the U.S shale oil sector is borrowing money to pay dividends and engage in share buybacks, with the probable price of oil going BELOW $60... instead of paying debt back. Rigs are dropping as fast as well productivity. People are getting laid off. The article is not accurate and not an indication whatsoever of what is coming down the pike.