Drilling Deeper: Interview with J. David Hughes

Off the microphones of J. David Hughes, Monsta & RE

Follow us on Twitter @doomstead666
Friend us on Facebook

Aired on the Doomstead Diner on December 1, 2014

logopodcast

Discuss this Interview at the Podcast Table inside the Diner

Drilling Deeper: A Reality Check on U.S. Government Forecasts for a Lasting Tight Oil & Shale Gas Boom

cover_Drilling-Deeper_300w (2)http://shalebubble.postcarbon.org/wp-content/uploads/2013/02/David-Hughes-debate.jpgAbout a month ago, we had an opportunity to interview J. David Hughes, author of the recent report Drilling Deeper for the Post Carbon Institute.  The report takes a detailed look at the fracking plays being made around the country which the MSM and Oil Industry shills have claimed will develop energy Independence for the FSoA.  We held onto the podcast until December 1st, at the request of the PCI media department.

In the intervening time since we recorded the broadcast, the price of Oil has further dropped from the $80 or so it was then, now down to around $69 in the last price quote I saw for WTI Crude.  This price is now down so low it is below the “Best Estimate” and is a worst case scenario for the drillers.  Oil Rigs are already being shut in in the Bakken, and the longer the low prices are maintained, the more will go down.

From the Texas Star-Telegram:

Falling oil prices could cause pullback in Texas production

Posted Friday, Nov. 28, 2014

OPEC’s decision to maintain production levels instead of cutting them caused oil prices to plummet, leading some analysts to predict a “pullback” in domestic oil production.

The price of U.S. crude fell by 10 percent Friday to $66.15 a barrel after the oil cartel decided at its meeting in Vienna on Thursday to leave production at 30 billion barrels a day. Member nations are worried they’ll lose market share if they lower production.

Shares of companies across the energy industry fell, with Chevron sliding 5 percent and Irving-based Exxon Mobil falling 4 percent. Halliburton, the oil field services company, saw its shares drop nearly 11 percent.

Bernard Weinstein, an economist at Southern Methodist University’s Maguire Energy Institute, said it is too early to tell the full impact of the falling oil prices. But for Texas, the No. 1 oil- and gas-producing state, it is not “good news.”

“I think we’re definitely going to see some pullback. We’ll see the rig count go down,” Weinstein said. “Wells that are already producing will not be shut down, but we’ll see less drilling activity.”

Tom Kloza, chief oil analyst at the Oil Price Information Service, had told the Star-Telegram that Thanksgiving week would be a “Super Bowl week on oil fundamentals” because of the OPEC meeting. He now expects the price to fall an additional $5 or $10 a barrel before stopping.

“It’s that kind of rout,” Kloza told The Associated Press on Friday .

Partly because of the shale production boom in the U.S., the world is awash in oil at a time when demand from major economies is weak — so prices are falling. Citibank analysts wrote in a report Thursday that global supplies exceed demand by about 700,000 barrels a day now.

Overall, the slide is a boon for consumers, with gasoline prices at their lowest point since 2010.

The national average was $2.79 on Friday. Kloza expects gas to eventually be a full $1 below its June peak of about $3.70 a gallon. That would save typical households $60 a month for those that burn 60 gallons of fuel.

“It’s a nice easy calculation,” Kloza said. “These are numbers that we would have regarded three or four months ago as something from the lunatic fringe.”

The bottom should come between $2.50 and $2.70, Kloza said.

But there are some negatives to the euphoria over paying less at the pump, Weinstein said.

A decade ago, the oil and gas industry accounted for about 2 percent of the gross domestic product. Now it’s more like 8 percent, he said.

Besides the energy companies themselves, the industry includes those that provide materials needed for drilling, he said.

The companies that will immediately feel the impact are the small to midsize energy firms that started in the past few years and took on too much debt, he said.

“They went to the bank and they borrowed $100 million and so their revenue stream is down and they can’t cover their costs,” Weinstein said. “They will cut back first.”

So a big drop in the price of oil sends a “ripple effect throughout the economy,” Weinstein said.

In our interview, David also highlights the CapEx problems with natural gas, and the reason building expensive pipelines and export terminals doesn’t make economic sense given the rapid depletion of these fields, even in the “sweet spots”.

For the rest, listen to the Interview, and read the report if you have a lot of time on your hands.

Leave a Reply

Your email address will not be published. Required fields are marked *

Knarf plays the Doomer Blues

https://image.freepik.com/free-icon/musical-notes-symbols_318-29778.jpg

Support the Diner
Search the Diner
Surveys & Podcasts

NEW SURVEY

Renewable Energy

VISIT AND FOLLOW US ON DINER SOUNDCLOUD

" As a daily reader of all of the doomsday blogs, e.g. the Diner, Nature Bats Last, Zerohedge, Scribbler, etc… I must say that I most look forward to your “off the microphone” rants. Your analysis, insights, and conclusions are always logical, well supported, and clearly articulated – a trifecta not frequently achieved."- Joe D
Archives
Global Diners

View Full Diner Stats

Global Population Stats

Enter a Country Name for full Population & Demographic Statistics

Lake Mead Watch

http://si.wsj.net/public/resources/images/NA-BX686_LakeMe_G_20130816175615.jpg

loading

Inside the Diner

OK, Pork Chops are not Ham, but they are still Pig 🐖 Meat, so they roughly fit the theme of the week here in the Diner Kitchen.    You want a real good pork chop to make these, good FAT content!  Mangalitsas would probably work well....

Quote from: Palloy2 on Today at 03:58:41 PMQuoteThey did give us Satellites though, which improved communications Not the ISS, that gave us nothing apart from long-term monitoring of astronaut physiology.[/q...

QuoteThey did give us Satellites though, which improved communications Not the ISS, that gave us nothing apart from long-term monitoring of astronaut physiology.

The Noose gets Tighter...http://www.youtube.com/v/83qxmqAI768...

Quote from: Palloy2 on Today at 02:38:55 PMQuotehttps://en.wikipedia.org/wiki/Space_blanketFirst developed by NASA's Marshall Space Flight Center in 1964 for the US space program ... was used e.g. on the Apollo Lunar...

Diner Twitter feed

Knarf’s Knewz

QuoteWhy delete movies?  Other Diners might find t [...]

Quote from: knarf on February 22, 2018, 11:08:28 P [...]

I want to let the readers on my newz channel know [...]

Quote from: Surly1 on February 22, 2018, 03:45:49 [...]

Knarf, where are you? You OK? [...]

Diner Newz Feeds
  • Surly
  • Agelbert
  • Knarf
  • Golden Oxen
  • Frostbite Falls

Trump Ditched the Script at CPAC. Here's What [...]

A nod to knarf... welcome back, if even for a minu [...]

Quote from: Golden Oxen on February 22, 2018, 03:3 [...]

Quote from: luciddreams on February 22, 2018, 02:5 [...]

Yeah, so, am I the only one that thinks there ain [...]

QuoteKarl Rove strategy #3: Accuse your opponent o [...]

Recent Windpower Articles֍ EU... [...]

Quote from: Golden Oxen on February 08, 2018, 12:3 [...]

I just call 'em like I see 'em. I never [...]

QuoteWhy delete movies?  Other Diners might find t [...]

Quote from: knarf on February 22, 2018, 11:08:28 P [...]

I want to let the readers on my newz channel know [...]

Quote from: Surly1 on February 22, 2018, 03:45:49 [...]

Knarf, where are you? You OK? [...]

I agree. Definitely a scapegoating thing. They wer [...]

Quote from: Palloy2 on February 22, 2018, 02:24:12 [...]

QuoteRickards: Just the existence of these geopoli [...]

Good Newz!  I should live to be 100!  REhttps://ww [...]

http://www.bbc.com/news/business-43124259KFC shuts [...]

We are getting another snowfall here today, looks [...]

The Alaska Soap Opera continues...REhttps://www.us [...]

It was a walk in, spirit change.8th inning relieve [...]

Alternate Perspectives
  • Two Ice Floes
  • Jumping Jack Flash
  • From Filmers to Farmers

The Pendulum - Part One Retreat to High Ground By High Desert     Missing in the mix of hundreds of [...]

The (Mind) Games People Play By Cognitive Dissonance     Fair warning! This is a long and dense read [...]

Wisdom, Experience and Just-In-Time Thinking By Cognitive Dissonance   I try to remind myself each g [...]

This and That Vol 4 Mid Winter Musings By Cognitive Dissonance     Probably the one topic Mrs. Cog a [...]

Taking a Pass on Gas – Wood Preferred - Part Three By High Desert Homesteading This is the final ins [...]

Event Update For 2018-02-21http://jumpingjackflashhypothesis.blogspot.com/2012/02/jumping-jack-flash-hypothesis-its-gas.html Th [...]

Event Update For 2018-02-20http://jumpingjackflashhypothesis.blogspot.com/2012/02/jumping-jack-flash-hypothesis-its-gas.html Th [...]

Event Update For 2018-02-19http://jumpingjackflashhypothesis.blogspot.com/2012/02/jumping-jack-flash-hypothesis-its-gas.html Th [...]

Event Update For 2018-02-18http://jumpingjackflashhypothesis.blogspot.com/2012/02/jumping-jack-flash-hypothesis-its-gas.html Th [...]

Event Update For 2018-02-17http://jumpingjackflashhypothesis.blogspot.com/2012/02/jumping-jack-flash-hypothesis-its-gas.html Th [...]

NYC plans to undertake the swindle of the civilisation by suing the companies that have enabled it t [...]

MbS, the personification of the age-old pre-revolutionary scenario in which an expiring regime attem [...]

You know things have taken a turn for the desperate when women have started to drive. Or rather, whe [...]

From Filmers to Farmers is re-launched on the astounding open source blogging platform Ghost! [...]

The blogging scene is admittedly atrocious. Is there really no option for a collapse blogger to turn [...]

Daily Doom Photo

man-watching-tv

Sustainability
  • Peak Surfer
  • SUN
  • Transition Voice

Breathing Highways and Sponge Cities"We could do worse than to go back to the way nature manages rainfall."During the 20th Cen [...]

Junk Food for Salmon"For the geoengineering set, all this news provides an opening for more advanced biotech . [...]

Follow the Money, Mr. Mueller"“Ivanka got her father to bomb Syria by adroitly pushing his buttons. ‘Ivanka had long ago fig [...]

Yarrow's Spiderweb"We are, like spiders, carbon creations that have learned to use carbon as tools. "At the [...]

A Hawaiian Missile Lullaby"Q: What should one do to prepare for an incoming ICBM just minutes away?A: Hug. Smile. Your sh [...]

The folks at Windward have been doing great work at living sustainably for many years now.  Part of [...]

 The Daily SUN☼ Building a Better Tomorrow by Sustaining Universal Needs April 3, 2017 Powering Down [...]

Off the keyboard of Bob Montgomery Follow us on Twitter @doomstead666 Friend us on Facebook Publishe [...]

Visit SUN on Facebook Here [...]

To fight climate change, you need to get the world off of fossil fuels. And to do that, you need to [...]

Americans are good on the "thoughts and prayers" thing. Also not so bad about digging in f [...]

In the echo-sphere of political punditry consensus forms rapidly, gels, and then, in short order…cal [...]

Discussions with figures from Noam Chomsky and Peter Senge to Thich Nhat Hanh and the Dalai Lama off [...]

Lefty Greenies have some laudable ideas. Why is it then that they don't bother to really build [...]

Top Commentariats
  • Our Finite World
  • Economic Undertow

I've always wanted to inject heroin and cocaine at the same time, and on a daily basis. Thanks [...]

Interesting, thanks. So we might be looking into short few yrs window of ~3% /year decline phase, fo [...]

+++++++++++++ Whenever I encounter someone who spews on about politics.... particularly if they take [...]

Or... maybe it's not character that is lacking rather it's lack of profound stuuuupidity t [...]

GDP can be faked I think. So we’re in this weird space of real contraction and fake expansion. [...]

I wonder whether anyone is discussing the environmental consequences of our constant wars. I see the [...]

Hi Steve - FYI my browser tried to stop me from viewing comments by saying that your "certifica [...]

Central banks are system regulators. When they allow commercial bankers commit crimes they are compl [...]

In a way Steve, it seems that you are always arguing that the system is legit, even though many of u [...]

Coming at this from the perspective of a "woo", it's clear to me that a lot of negati [...]

RE Economics

Going Cashless

Off the keyboard of RE Follow us on Twitter @doomstead666...

Simplifying the Final Countdown

Off the keyboard of RE Follow us on Twitter @doomstead666...

Bond Market Collapse and the Banning of Cash

Off the microphone of RE Follow us on Twitter @doomstead666...

Do Central Bankers Recognize there is NO GROWTH?

Discuss this article @ the ECONOMICS TABLE inside the...

Singularity of the Dollar

Off the Keyboard of RE Follow us on Twitter @doomstead666...

Kurrency Kollapse: To Print or Not To Print?

Off the microphone of RE Follow us on Twitter @doomstead666...

SWISSIE CAPITULATION!

Off the microphone of RE Follow us on Twitter @doomstead666...

Of Heat Sinks & Debt Sinks: A Thermodynamic View of Money

Off the keyboard of RE Follow us on Twitter @doomstead666...

Merry Doomy Christmas

Off the keyboard of RE Follow us on Twitter @doomstead666...

Peak Customers: The Final Liquidation Sale

Off the keyboard of RE Follow us on Twitter @doomstead666...

Collapse Fiction
Useful Links
Technical Journals

West Africa is a very vulnerable part of the world to the impacts of climate change due to a combina [...]

Green areas induce smaller increases in the air temperature than built-up areas. They can offer a so [...]

The study of frequency analysis is important to find the most suitable model that could anticipate e [...]

Follow on our http://www.doomsteaddiner.net/forum/