Enormous oil & gas boom to overwhelm the economy?

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Bill Bryan
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Enormous oil & gas boom to overwhelm the economy?

Post #1 by Bill Bryan » February 27th, 2013, 10:39 am

One a my peeps posted a link yesterday that had me mesmerized: A video by Porter Stansberry. He's a controversial guy, an investment adviser who was once convicted of fraud.*

He made two predictions:

  • We're about to see the biggest oil and gas boom in the history of this great nation, which will cause the economy to take off like a rocket. :shock:

  • President Obama will use the boom to get himself a third term of office (or maybe he'll run Michelle instead). :lol:

Everybody had a good laugh about the third term (and for good reason), but what about the oil boom? Can he be wrong about politics but right about the economy?

Fracking and horizontal drilling are environmental nightmares, but are there really 100 billion barrels of oil coming out of American shale fields over the next few years? Are there really 140 LNG supertankers under construction? Is natural gas really dirt cheap in the US because we can't export it to satisfy world demand? Are we about to overcome that?

Because if the oil is there and it's economically feasible to get it out and sell it, I am here to tell you that environmentalists yappin' about damage to the ecosystem isn't going to slow down the oil boom for a Noo York second. Demand for oil and gas is unlimited, as India and China and other countries industrialize; the environment be damned. People are who they are, and as much as I care about the environment, I think market forces will make it a lower priority.

Are we really about to see a huge economic boom in this great land of ours?

Wall Street Journal: U.S. Oil-Production Rise Is Fastest Ever,http://online.wsj.com/article/SB10001424127887323468604578249621718888086.html
U.S. oil production grew more in 2012 than in any year in the history of the domestic industry, which began in 1859, and is set to surge even more in 2013.

Daily crude output averaged 6.4 million barrels a day last year, up a record 779,000 barrels a day from 2011 and hitting a 15-year high, according to the American Petroleum Institute, a trade group.

It is the biggest annual jump in production since Edwin Drake drilled the first commercial oil well in Titusville, Pa., two years before the Civil War began.

The U.S. Energy Information Administration predicts 2013 will be an even bigger year, with average daily production expected to jump by 900,000 barrels a day.

Oil production IS soaring due to fracking and horizontal drilling. There IS a glut of natural gas in this country, with much lower prices here than abroad, because of transportation problems. When they solve the transportation problems, there's a monstrous fortune to be made selling natural gas to other countries.

And there ARE a trillion freakin' barrels of oil under the ground, right here in the good ol' U.S.A.

Institute for Energy Research
Depending on technology and economics, as much as 1 trillion barrels of oil equivalent could be recoverable from oil shale resources yielding greater than 25 gallons per ton. For reference, 1 trillion barrels is nearly 4 times the amount of proven oil reserves in Saudi Arabia. The energy potential from our vast resources of oil shale could substantially shift the balance of America’s oil supply away from the Persian Gulf.


Stansberry's facts -- the things he says about what is happening today as I write this -- appear to be solid. His predictions about President Obama are cowpies. His predictions for the future of the economy may not be. I think this bears watching.

Carry on. Drill, baby, drill. Save the tatas.

* He predicted a company's stock price would soar, and it did soar for the reasons he stated (but a month later than he predicted). However, he made up the source of those reasons.
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The Oracle
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Re: Enormous oil & gas boom to overwhelm the economy?

Post #2 by The Oracle » February 27th, 2013, 11:15 am

I'm not seeing any price reductions on my natural gas bill. :-k

Which train of thought are we talking about here?:

A new economy powered by people in hard-hats?

or...

Trickle down economics....... where the price stays high for consumers. And the profits are made by commodity traders. And their derivitive friends like retirees. Who then spend from above?

Or...

Consumers who see inexpensive product at the pump and meter? For all the talk; there's little evidence that it's going to be consumers. Our own 401k plans run up commodity traders.

Or a combination of the three? If gas was $2.00 you'd see a lot of happy consumers run right out to Walmart and buy something on credit. Consumer spending drives the economy; not gas prices. The boom would actually benefit few outside the industry besides retirees.

maybe I should read the link.... ;)

ok... I listened to a little bit. Investors numbering about 2% of the population will make the money. The other 98% will eat cake. And that cake will be inflation adjusted to about $7/ slice.

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Bill Bryan
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Re: Enormous oil & gas boom to overwhelm the economy?

Post #3 by Bill Bryan » February 27th, 2013, 2:51 pm

There is also the coming environmental disaster from Alberta's attempt to become the Saudi Arabia of the Americas. All of these unconventional sources of petroleum threaten to derail the development of alternative energy sources and, at the same time, to be far more environmentally destructive than anything that ever occurred in an oil field. It's also ruining Canada for the last remaining indigenous people.

It is hard to exaggerate how very bad for the planet and its inhabitants this project is. However, Alberta is BOOMING because of fracking and so forth.

That about sums it up for me. It does appear that we're headed toward the biggest boom in history -- and the worst environmental disaster in history. While you and I enjoy bread and circuses at market prices.

:evil: ?( :roll: That's OK, our grandchildren can clean it up later. :roll: ?( :evil:

You're old enough and cynical enough to understand that human greed will win out. If the money starts to flow, it's going to be damn near impossible to convince people to leave the oil in the ground just because it's bad for the environment to extract it. Instead, the environmentalists are going to be trampled in the mob rush to cash in.

Here's another aspect: When oil & gas prices are low, it doesn't make sense to invest huge amounts of money in extraction. But as the current supply of gas dwindles, the price will go up. When the price goes up, suddenly it's economically feasible to extract using the new technologies. Like the technology to freeze natural gas to -259° so it can be transported as a liquid. Like fracking and horizontal drilling.

It's very possible this boom could be the central fact of American life for the next 20 or 25 years. I think we'd better spend some time figuring out what it all means. If Alberta is BOOMING, guess who booms next?

To me, the key questions are:

1. Are there really a trillion barrels of oil extractable from oil shale in the U.S.?

2. Is oil production already soaring as fracking and horizontal drilling come into play more and more?

If the answer to both of those questions is yes, then we could be in a heap of trouble. Clean, renewable energy will remain a distant dream for a lot longer than I thought.

Because we ARE going to extract and burn all that oil, at some point or other. The only thing preventing that is the cost, and it seems the cost isn't going to prevent it much longer.
"My presidency is entering the fourth quarter. Interesting stuff happens in the fourth quarter."
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The Oracle
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Re: Enormous oil & gas boom to overwhelm the economy?

Post #4 by The Oracle » February 28th, 2013, 7:26 am

North Carolina just threw it's head geologist off the board that oversees fracking in North Carolina.

They've decided to silence costal sea level critics and kill the science. Now they've decided to throw the geologist off bigtime geology questions. Now; if we could just get God put back into his correct place........

we can all pretend it's 1910. The Vanderbilts, Carnige's, and Rockefellers rule again. Except this time; you can play the market. It's so easy a child can do it. Honestly; only dumbass's like me and you won't play along. What's wrong with us? Why do we hate Amerika?



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Re: Enormous oil & gas boom to overwhelm the economy?

Post #5 by John Thomas8 » March 2nd, 2013, 7:41 am

The valley in NE Pennsylvania where my in-laws live is being subjected to fracking. It's an intensely ugly operation. Seriously.

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Bill Bryan
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Re: Enormous oil & gas boom to overwhelm the economy?

Post #6 by Bill Bryan » March 4th, 2013, 6:16 am

This is why I'm worried about the "boom," of course. It will be an ecological nightmare.

I've always thought that the basic economics mean we'll bring up every drop of oil before we face reality. Today it's not financially feasible to bring up some of the more inaccessible oil. But demand is increasing and when supply starts to decrease, the price WILL go up; that's the basic law of economics. When gasoline hits $25/gallon, suddenly it will become more feasible to go after a lot of deposits that aren't feasible today. When the price of gas hits $50/gallon ...

We still haven't finished destroying Alaska, either.

But some of my peeps on Fogbow are saying they drill 5 enormously expensive wells to find oil where they used to get by with one. At some point -- no matter what the price of gasoline is -- the cost of drilling/fracking/whatever is going to be prohibitive. When the amount of energy needed to frack is higher than the amount of energy fracking delivers, it will have to stop. You can't spend $5 million on an operation that's going to produce $4 million worth of oil.

Until then, we're in big trouble. And the Repugs are keeping the president so bizzy that he's not getting the time to get us started on the road to 100% clean renewable energy, which we have to do.

Y'all should check out [link]BlueNC,http://www.bluenc.com[/link]. They have a Friday Fracking Video every week, and they're way dialed into the fracking situation in Cackilacky.
"My presidency is entering the fourth quarter. Interesting stuff happens in the fourth quarter."
- President Barack Obama

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Re: Enormous oil & gas boom to overwhelm the economy?

Post #7 by 7rob7 » March 4th, 2013, 8:42 am

Progress is hard when we live in a world full of people like this:

[center]Washington Republican: Bicycles cause more pollution than cars[/center]
The ranking Republican member on Washington state’s House Transportation Committee thinks that riding bicycles causes more pollution than driving cars, the Seattle Bike Blog reported Saturday.

State Rep. Ed Orcutt (R), pictured, wrote an email to a constituent who disagreed with his support for a new tax on the sales of bicycles, a proposal being considered as part of a larger piece of transportation legislation. Reached by the Seattle Bike Blog, he confirmed the email is real.

In his message, sent to the owner of a bicycle shop, Orcutt wrote: “If I am not mistaken, a cyclists [sic] has an increased heart rate and respiration. That means that the act of riding a bike results in greater emissions of carbon dioxide from the rider. Since CO2 is deemed to be a greenhouse gas and a pollutant, bicyclists are actually polluting when they ride.”
There's nowhere you can be that isn't where you're meant to be; it's easy.

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Re: Enormous oil & gas boom to overwhelm the economy?

Post #8 by 7rob7 » March 4th, 2013, 8:49 am

A few weeks ago I was asked to come in and talk to some sixth graders about set design, because their teacher had put together a project where they -- in groups -- wrote and produced their own shows. I was one of several area professionals invited to talk to the kids about various aspects of production.

It was great, and the thank-you notes I got from them afterward are going to somehow be turned into something I can hang on my office wall. Made me gooey and embarrassed and inspired all at the same. Aw, shucks.

Regardless, the reason I mention this here is because one of the sketches the kids created was called, What the Frack?

There may be hope.
There's nowhere you can be that isn't where you're meant to be; it's easy.


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