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USGS Announces Largest Continuous Oil Assessment in Texas and New Mexico

58 points by LopRabbit 8y ago

deleted 8y ago
[deleted]
mogadsheu 8y ago
These guys at the USGS are a bit late to the party but they’re doing a good thing (for the economy, maybe not the environment) by publishing research like this. Many companies have formed their opinions on these plays already, often with superior data, but foreign companies, smaller companies, and firms not as focused on the region will benefit. The hope from the USGS side is that it will spur investment into the region. The biggest issue? Cost of extraction/breakeven pricing, bar none. Fwiw: I worked in the energy industry as a geologist for some years.
- ejanus 8y ago
  Why are they not mining these plays already when they have convincing data ?
  - mogadsheu 8y ago
    The areas are either considered higher risk or more costly to extract.
glup 8y ago
While I understand the perceived geopolitical need for energy independence, I sure hope we don't develop this. With recent reports like the NCA4 (nca2018.globalchange.gov), it's pretty clear things are going to get a whole lot worse with climate change, that will take a very long time to retool our infrastructure even with a strong economic incentive. Cheap and plentiful oil certainly doesn't help. I also think that flying over this region (Permian basin / western Texas) on a clear day is --- as it is currently, without further extraction --- one of the best ways to understand the sheer scale of energy extraction required to support the American economy and lifestyle. If you haven't seen it, check out the satellite imagery of Pyote, TX on Google Maps or similar.
- txcwpalpha 8y ago
  Flying over the oil fields is fascinating (I personally find the South Texas oil fields at night to be even more so), but the other interesting perspective that you get to see is the massive wind farms just a handful of miles away from the oil farms. They're harder to see on Google maps (since the turbines are vertical rather than taking up a lot of horizontal space), but if you're on a flight or driving through the area you can really get a sense of the scale of them. Some of them are even larger than the oil fields, and yet they hardly extract even a fraction of the energy. For all the faults of Texas's oil fields, the state is also at the forefront of wind energy. But the reality is that we're still nowhere near being able to afford not drilling.
  - joe_the_user 8y ago
    When drilling (taken broadly as exploiting hydrocarbons to the hilt) has the potential for the extinction of the species and wind-farms and renewables generally have the potential to provide sufficient energy for species survival, yeah, we can afford not to drill. Energy density isn't everything. There's also not dying in fire/floods/tornadoes/civil-unrest.
  - ryanmarsh 8y ago
    Flying over south Texas oil fields... are you thinking of Texas City or Pasadena? Those aren’t oilfields. They’re refineries.
    - txcwpalpha 8y ago
      Nope, I was referring to the massive group of oil fields called the Eagle Ford play that stretches from the Mexico border near Hidalgo, going Northeast all the way up until I-10 east of San Antonio. See this photo: https://s.hdnux.com/photos/17/05/74/3956516/5/920x920.jpg https://s.hdnux.com/photos/17/05/74/3956516/5/920x920.jpg
  - dreamcompiler 8y ago
    > Some of them are even larger than the oil fields, and yet they hardly extract even a fraction of the energy Total energy extracted over a couple of centuries is dramatically higher with wind. Oil is stored solar energy that eventually runs out; wind is realtime solar energy that never runs out.
code_duck 8y ago
Not surprising. The boom in the Permian Basin has already been massive. Driving through southeastern New Mexico, you see a hellscape of hastily strung, sloppy power lines across vast fields of drill rigs, with signs warning you of the possibility of poison gas.
- deleted 8y ago
  [deleted]
flerchin 8y ago
I drove through this region on my way to Carlsbad Caverns and the extraction already happening is surreal. You can see flares for miles. Not so far away, herds graze in the shadow of windmills.
- ryanmarsh 8y ago
  Flares? I thought it was illegal to flare off NG and Y grade?
  - FlyMoreRockets 8y ago
    I don't know about the legality, but last time I drove through, there were some pretty massive flares. They lit up the surroundings for tens of miles. Like hell on Earth.
pfarnsworth 8y ago
Incredible how the US has transformed into the largest producer of crude oil in the world in the matter of a few short years. It's definitely a geopolitical weapon to attack those in the Middle East with, especially the Saudis, although it's not clear to me whether they are complicit or not with this current US policy of pumping and dumping oil. Now that ISIS is all but dismantled, maybe the other target is Syria and Iran or even Russia. In a similar way Reagan outspent the Soviet Union in nuclear arms race, this definitely feels like pumping so much oil and keeping oil prices low is in order to destabilize at least one or two of our political enemies that rely on oil revenues.
- Phlarp 8y ago
  But Saudi Arabia is our political _ally_
  - curuinor 8y ago
    More a frenemy, really.
- adventured 8y ago
  Reagan didn't spend the USSR into disintegration. The USSR collapsed as it did due to the dramatic oil price drop caused by Paul Vocker's strengthening of the dollar in the 1980s. Oil is priced in dollars, so if you considerably increase the value of the dollar, you'll sink the price of oil, which will hammer most foreign oil producers. The dollar index went from ~80 to ~160, from roughly 1980 to 1986, by far the greatest dollar move in modern history. Oil moved inversely to the dollar gains. The USSR economy was heavily dependent on the price of oil staying as high as it was in the 1970s (oil went from ~$20 to $100+, levels it had never remotely seen before). Having gotten used to the price of oil being so high throughout the 1970s, their already weak system was unable to absorb the outsized shock of oil plunging from $100+ to $30 during ~1980-1988. In the 1950s the USSR barely had an oil economy at all. From 1960 to 1980 (they passed the US in oil production around 1975-76), their oil output had climbed by about seven fold, making them very dependent on that resource. Had oil remained high, the USSR could have continued to spend as necessary to try to keep their system together. For an economy as dependent on oil as theirs was by 1980, removing that much revenue by tanking oil from $100 to $30, is a deadly wound on top of an already shaky foundation. While very plausibly their system would have failed regardless eventually, a high oil price would have likely bought them more time. The dollar is what broke the USSR. It's also what threw Russia into a sudden and dramatic recession after Crimea and curtailed their pursuit of further territorial annexation (at least for a while). The US stopped QE and signaled the beginning of rate hikes, which sent the dollar soaring and took took oil from $105+ in June 2014 to under $28 in about 18 months (the global economy was growing fine and oil had been in oversupply for years; it was the dollar move that popped the market). Oil tanked immediately after the Russian Crimea events in July-August 2014.... The dollar is by far the greatest weapon in the US arsenal. If you want to restrain Russia, push the dollar high.
doggydogs94 8y ago
No need to develop these fields when we can import oil instead.

58 points by LopRabbit 8y ago

deleted 8y ago

[deleted]

These guys at the USGS are a bit late to the party but they’re doing a good thing (for the economy, maybe not the environment) by publishing research like this. Many companies have formed their opinions on these plays already, often with superior data, but foreign companies, smaller companies, and firms not as focused on the region will benefit. The hope from the USGS side is that it will spur investment into the region. The biggest issue? Cost of extraction/breakeven pricing, bar none. Fwiw: I worked in the energy industry as a geologist for some years.

ejanus 8y ago
Why are they not mining these plays already when they have convincing data ?
- mogadsheu 8y ago
  The areas are either considered higher risk or more costly to extract.

glup 8y ago

While I understand the perceived geopolitical need for energy independence, I sure hope we don't develop this. With recent reports like the NCA4 (nca2018.globalchange.gov), it's pretty clear things are going to get a whole lot worse with climate change, that will take a very long time to retool our infrastructure even with a strong economic incentive. Cheap and plentiful oil certainly doesn't help. I also think that flying over this region (Permian basin / western Texas) on a clear day is --- as it is currently, without further extraction --- one of the best ways to understand the sheer scale of energy extraction required to support the American economy and lifestyle. If you haven't seen it, check out the satellite imagery of Pyote, TX on Google Maps or similar.

txcwpalpha 8y ago
Flying over the oil fields is fascinating (I personally find the South Texas oil fields at night to be even more so), but the other interesting perspective that you get to see is the massive wind farms just a handful of miles away from the oil farms. They're harder to see on Google maps (since the turbines are vertical rather than taking up a lot of horizontal space), but if you're on a flight or driving through the area you can really get a sense of the scale of them. Some of them are even larger than the oil fields, and yet they hardly extract even a fraction of the energy. For all the faults of Texas's oil fields, the state is also at the forefront of wind energy. But the reality is that we're still nowhere near being able to afford not drilling.
- joe_the_user 8y ago
  When drilling (taken broadly as exploiting hydrocarbons to the hilt) has the potential for the extinction of the species and wind-farms and renewables generally have the potential to provide sufficient energy for species survival, yeah, we can afford not to drill. Energy density isn't everything. There's also not dying in fire/floods/tornadoes/civil-unrest.
- ryanmarsh 8y ago
  Flying over south Texas oil fields... are you thinking of Texas City or Pasadena? Those aren’t oilfields. They’re refineries.
  - txcwpalpha 8y ago
    Nope, I was referring to the massive group of oil fields called the Eagle Ford play that stretches from the Mexico border near Hidalgo, going Northeast all the way up until I-10 east of San Antonio. See this photo: https://s.hdnux.com/photos/17/05/74/3956516/5/920x920.jpg https://s.hdnux.com/photos/17/05/74/3956516/5/920x920.jpg
- dreamcompiler 8y ago
  > Some of them are even larger than the oil fields, and yet they hardly extract even a fraction of the energy Total energy extracted over a couple of centuries is dramatically higher with wind. Oil is stored solar energy that eventually runs out; wind is realtime solar energy that never runs out.

code_duck 8y ago

Not surprising. The boom in the Permian Basin has already been massive. Driving through southeastern New Mexico, you see a hellscape of hastily strung, sloppy power lines across vast fields of drill rigs, with signs warning you of the possibility of poison gas.

deleted 8y ago
[deleted]

flerchin 8y ago

I drove through this region on my way to Carlsbad Caverns and the extraction already happening is surreal. You can see flares for miles. Not so far away, herds graze in the shadow of windmills.

ryanmarsh 8y ago
Flares? I thought it was illegal to flare off NG and Y grade?
- FlyMoreRockets 8y ago
  I don't know about the legality, but last time I drove through, there were some pretty massive flares. They lit up the surroundings for tens of miles. Like hell on Earth.

pfarnsworth 8y ago

Incredible how the US has transformed into the largest producer of crude oil in the world in the matter of a few short years. It's definitely a geopolitical weapon to attack those in the Middle East with, especially the Saudis, although it's not clear to me whether they are complicit or not with this current US policy of pumping and dumping oil. Now that ISIS is all but dismantled, maybe the other target is Syria and Iran or even Russia. In a similar way Reagan outspent the Soviet Union in nuclear arms race, this definitely feels like pumping so much oil and keeping oil prices low is in order to destabilize at least one or two of our political enemies that rely on oil revenues.

Phlarp 8y ago
But Saudi Arabia is our political _ally_
- curuinor 8y ago
  More a frenemy, really.
adventured 8y ago
Reagan didn't spend the USSR into disintegration. The USSR collapsed as it did due to the dramatic oil price drop caused by Paul Vocker's strengthening of the dollar in the 1980s. Oil is priced in dollars, so if you considerably increase the value of the dollar, you'll sink the price of oil, which will hammer most foreign oil producers. The dollar index went from ~80 to ~160, from roughly 1980 to 1986, by far the greatest dollar move in modern history. Oil moved inversely to the dollar gains. The USSR economy was heavily dependent on the price of oil staying as high as it was in the 1970s (oil went from ~$20 to $100+, levels it had never remotely seen before). Having gotten used to the price of oil being so high throughout the 1970s, their already weak system was unable to absorb the outsized shock of oil plunging from $100+ to $30 during ~1980-1988. In the 1950s the USSR barely had an oil economy at all. From 1960 to 1980 (they passed the US in oil production around 1975-76), their oil output had climbed by about seven fold, making them very dependent on that resource. Had oil remained high, the USSR could have continued to spend as necessary to try to keep their system together. For an economy as dependent on oil as theirs was by 1980, removing that much revenue by tanking oil from $100 to $30, is a deadly wound on top of an already shaky foundation. While very plausibly their system would have failed regardless eventually, a high oil price would have likely bought them more time. The dollar is what broke the USSR. It's also what threw Russia into a sudden and dramatic recession after Crimea and curtailed their pursuit of further territorial annexation (at least for a while). The US stopped QE and signaled the beginning of rate hikes, which sent the dollar soaring and took took oil from $105+ in June 2014 to under $28 in about 18 months (the global economy was growing fine and oil had been in oversupply for years; it was the dollar move that popped the market). Oil tanked immediately after the Russian Crimea events in July-August 2014.... The dollar is by far the greatest weapon in the US arsenal. If you want to restrain Russia, push the dollar high.

doggydogs94 8y ago

No need to develop these fields when we can import oil instead.