[bratticus]

Fantasy:

sustainability rap songs

Reality:

off shore drilling

[doodlebug2]

I heard this about CA this morning and was curious also.
Will they actually start drilling? when? Will it help?
Is this the anser to teir problem or is it just smoke and mirrors?

[hillsidedigger]

From what I've read there's about 5 billion barrels of oil just offshore from Santa Barbara but can it be produced without spoiling the coastline there?

[Maddog78]

Remains to be seen but they should be able to.
Strict operating restrictions such as Norwegian style regs. should take care of it.

[vampyregirl]

Shell has announced a signifigant new oil discovery in the deepwater eastern Gulf of Mexico, adding to discoveries in the area from 2009.
The discovery is located in the Appomatax prospect in 2200 metres of water in the Mississippi Canyon blocks 391 and 392.
Shell drilled the discovery well on block 392 to a depth of 7,643 metres and found 162 metres of oil pay. Shell then drilled an appraisal sidetrack to 7,910 metres and found 116 metres of oil pay. Additional appraisal drilling is planned for later this year.
Shell is the operator and holds an 80% interest in the project.
In 2009 Shell made discoveries at West Boreas, Vito, and Cardamom Deep.

[Keith_McClary]

Is it bigger than a breadbox?

[Blacksmith]

Shell has announced a signifigant new oil discovery in the deepwater eastern Gulf of Mexico, adding to discoveries in the area from 2009.

Any idea what recovery costs are?

[ian807]

Extraction costs? Energy return? Recoverable oils expressed as number of barrels?

[dinopello]

Over 6 miles down from sea level - that is one long straw.

[Blacksmith]

The reason I asked this question of recovery costs which cover, exploration and development costs determines payout. The president of Petrobras said about a year ago that $175 a barrel would make their deep water resources profitable.

[NeoPeasant]

I've often wondered what fraction of a barrel of oil's energy is required to lift a barrel of oil six miles or more. How deeply can we drill and pump before we can no longer profit from it?

[TheDude]

The announcement was made last week. Headlines suggest "significant" and "huge." Shell will release more info later this year.

Obviously energy premiums to extract don't make wells like this uneconomical, or they would never be drilled.

[AAA]

Obviously energy premiums to extract don't make wells like this uneconomical, or they would never be drilled.

That is one of the problems with PO. Too many PO enthusiasts focus on EROEI.

There is not a single oil company in the world that even takes into consideration EROEI. An oil company exists just like any other company and that is to provide a service or production in order to make money.

Companies do not take on projects that don't make money. They are profit driven and don't produce uneconomic projects to be nice. Any project that has a rig drilling is believed to be economic. No matter how expensive the project is someone in the company has modeled their forecast of costs and oil prices to convince upper management to proceed.

[dsula]

That is one of the problems with PO. Too many PO enthusiasts focus on EROEI.

EROEI is intrinsicly linked to money. You never need to worry about EROEI. As long as you worry about money the money does the EROEI worrying for you. ERoEI is hidden in the costs of all material, hence the term 'law of receding horizons'.

[rockdoc123]

I've often wondered what fraction of a barrel of oil's energy is required to lift a barrel of oil six miles or more. How deeply can we drill and pump before we can no longer profit from it?

The finding and developing cost for much of the deepwater is in the $17- $25/bbl range. So a quick calculation says at todays price that leaves total revenue stream of say $50 - $55 or there abouts. In North America contractor take after taxes is somewhere around 20% (a really rough average) which means the contractor ends up with about $10 or so per bbl net after tax (excuse my math very approximate and makes lots of assumptions). So 2 billion barrels translates into 20 billion dollars of net profit ignoring discounting etc.

The answer as to how deeply we can drill and pump is to do with technology...the question as to when we can no longer profit has to do with commodity price. When oil was at $30/bbl none of the deepwater made sense, at $80/bbl it looks great. From a technology perspective we have gradually gone into deeper and deeper water, I believe the deepest water tension leg platform is now in 2900 metres of water depth. Of course technology is also somewhat dependant on commodity price.

[Sixstrings]

The announcement was made last week. Headlines suggest "significant" and "huge." Shell will release more info later this year.

Obviously energy premiums to extract don't make wells like this uneconomical, or they would never be drilled.

The problem though is that all these new finds are nothing like the big finds in years past. There is no just dig a hole and watch the Texas Tea shoot out anymore. These new finds are major projects to get extraction going, with lead times of years (can be 7-10 years). So as the old big fields go dry, we're going to have an EROEI problem.

There will be oil, but it'll be very expensive and we'll have to endure shortages for up to a decade while waiting for fields to come online.

[vampyregirl]

There are no plans to begin pumping from Appomatax yet. More appraisal drilling is planned first. However the first crude is onstream from the Parque de Conchas field offshore Brazil in water just as deep. I already posted about that in another thread. It will pay for itself and then some. Shell is in business to MAKE money not lose it.

[JustaGirl]

There will be oil, but it'll be very expensive and we'll have to endure shortages for up to a decade while waiting for fields to come online.

So in a decade what do you see happening? New fields are online and we have a plateau at a lower level than today? a new peak? something else?