Skeptics of the Shale Oil & Gas Revolution Get A Bad Shock

… overall [US shale] oil and gas production [is] growing at breakneck speed, according to the report, [and] it is being driven by “increases in drilling efficiency and new well productivity, rather than an increase in the number of active rigs. _Business Week

The following is excerpted from a Brian Bremner article in Business Week. When combined with the information in this Real Clear Energy article, it casts a very bad light on shale energy skeptics indeed.

The U.S. shale energy boom has attracted plenty of skeptics. Petroleum geologist and consultant Art Berman has called the shale oil and gas expansion “more of a retirement party than a revolution.” Berman and others have cast doubt on the sustainability of the energy revival, given the mixed productivity at some fields and the relative high cost of extracting oil and gas in dense rock formations.

Also weighing in has been Russian President and shirtless horseback riding enthusiast Vladimir Putin, whose country may face unwelcome geopolitical challenges from shale assets worldwide. In the past, he has dismissed America’s energy renaissance as a bubble.

… International Energy Agency sees the U.S. emerging as a net exporter of oil by about 2030. By some estimates, the U.S. over the summer surpassed Russia to become the world’s largest producer of oil and natural gas.

Both sides can’t be right—and the debate is far from over. However, a new drilling productivity report by the U.S. Energy Information Administration seems sure to annoy shale boom deniers. Not only is overall oil and gas production growing at breakneck speed, according to the report, it is being driven by “increases in drilling efficiency and new well productivity, rather than an increase in the number of active rigs.”

The study looked at the six major U.S. shale formations that represent 90 percent of the growth in domestic oil production and nearly all the increase in gas.

Data: U.S. Energy Information Administration

And here’s the money stat: Drilling efficiency and well productivity are increasing, particularly for oil. EIA measures this in terms of new oil and gas production per rig.

Data: U.S. Energy Information Administration

Data: U.S. Energy Information Administration

_Brian Bremner in Businessweek

My apologies to Brian Bremner and Business Week for extensive “borrowing” from this article. Well graphed data can make thousands of words unnecessary and superfluous.

It is important for sincere readers to understand that the US private oil & gas industry is still in the very early stages of development for shale energy. New tools of exploration will elaborate new shale plays that were not thought worth developing in the past. New tools of production will only get more efficient over time. New tools of enhanced recovery will only increase the proportion of oil-in-place which can be retrieved.

It was foolish for doomer prognosticators to jump in and predict the imminent collapse of the shale energy industry.

Of course no one can predict the future. US President Obama’s EPA could introduce crippling new shale regulations at any moment, which would further increase the widespread economic hardship which Obama has brought to Americans. That would be yet another aspect of “political peak oil,” which is the only kind of peak oil that you are likely to see in your lifetime, except perhaps “peak oil demand,” from lack of need for oil.

More on the new EIA shale report, with links to why it matters.

More: You may not have to be a total imbecile to panic over peak oil — but it helps.

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3 Responses to Skeptics of the Shale Oil & Gas Revolution Get A Bad Shock

  1. Sam says:

    Excuse my intransigence but I’m still not convinced. I believe we are in or are at peak oil. I see the productivity per rig and I’m suitably impressed but it doesn’t say why there is more productivity. A guess might be that they’re getting better at getting gas and oil out of shale though experience. Doesn’t say. Could just be luck. Has there been the invention of some super drill? Still drilling a lot of holes and fracking is a lot more difficult than the old method of drilling and having the whole pipe drill stack blown out of the rig by the huge oil gusher which you then proceed to leisurely tap. Oil is just harder to get at and cost more. I don’t think we as a country are going to do anything about energy. I keep thinking of that Kirk Sorensen, of liquid thorium reactor fame, video where he holds up a small maybe inch and a half ball of thorium and says it could provide all the energy we need in our lifetime. Yet we do nothing. Our country has been taken over by a hostile tribe, flooded with immigrants legal and illegal and energy is being strangled to boost profits. I don’t see this ending well.

  2. Sam says:

    After I posted this it seemed a little harsh. Sorry but sometimes I become so glum about the prospects for my country it becomes a little too much.

  3. alfin2101 says:

    Certainly the US government has grown so large and corrupt that innovative people are finding it very difficult to jump through all the hoops, red tape, and obstacles cast by well-connected vested insterests, ideological activists, and greedy politically linked bastions of organized labour, organized crime, and organized tort law. The web of corruption is tenacious and ubiquitous. Getting anything done in the way of innovation or invention is much more difficult than it needs to be.

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