Official (Alberta) Oil Discussion Thread

[Mr.Coffee]

it's as much about "market share" as it is about politics.

[CampbellsTransgressions]

They're morons for falling victim to the same thing as us?

[nik-]

Originally Posted by CampbellsTransgressions

They're morons for falling victim to the same thing as us?

They're morons because they control the thing we fell victim to that is now victimizing them.

Also, when we're victims, our population doesn't rely on a guaranteed income to be placated.

[Kavvy]

Originally Posted by nik-

They're morons because they control the thing we fell victim to that is now victimizing them.

Also, when we're victims, our population doesn't rely on a guaranteed income to be placated.

Ok, as I can't tell from your post - we are not victims,

We, like most nations, pump as most oil as we can get to market - Saudi was really the only ones holding back.

don't disagree with the guaranteed income comment however.

[Fuzz]

If these idiots had any brains whatsoever they would do whatever they could to make as much money as possible before the golden goose goes tits up. Instead they are delusional enough to think they can control world production by killing competition, then going back to high prices. Well guess what, it ain't gonna work. When prices rise, so will production. It's called capitalism. So instead they go broke and basically give away their resources. Good work chaps. Well thought out. Enjoy your revolution.

[FLAMESRULE]

Originally Posted by Mr.Coffee

And another topic I wanted to post about is the current natural gas storage in Alberta is very high, and for at least 1/2 the month of February, we've seen a net injection of gas in February. Typically the winter months withdraw storage and then the summer months fill storage for the winter draw-down. Sometimes summer can withdraw if weather is really hot in large population centres that end up using a ton of A/C, but this is a problem.

Natural gas prices are horrifically low already, and this could be catastrophic to industry prices. Has the province ever even seen 100% storage?

Oh man, I'm in O+G, but if creditors can get away with pawning off the abandonment liability to the government it could be a complete disaster. There is no way that the liability should be passed to the taxpayer. I'll be very interested to see how this transpires (haven't seen any judgement yet).

[Weitz]

Originally Posted by FLAMESRULE

Oh man, I'm in O+G, but if creditors can get away with pawning off the abandonment liability to the government it could be a complete disaster. There is no way that the liability should be passed to the taxpayer. I'll be very interested to see how this transpires (haven't seen any judgement yet).

I'm trying to figure out what the difference is in this case compared to the other companies that go bankrupt and their wells end up on the Orphan Well List.

Unless this is just a 'test' run by the AER to try and keep more wells off the Ophan well list.

[burn_this_city]

Originally Posted by Fuzz

If these idiots had any brains whatsoever they would do whatever they could to make as much money as possible before the golden goose goes tits up. Instead they are delusional enough to think they can control world production by killing competition, then going back to high prices. Well guess what, it ain't gonna work. When prices rise, so will production. It's called capitalism. So instead they go broke and basically give away their resources. Good work chaps. Well thought out. Enjoy your revolution.

They weren't going to cut production so the shale guys could take their marketshare. The entire crisis was caused by the idiotic idea that adding millions of barrels per day of shale production could go on forever. I don't blame OPEC for telling everyone else to pound salt. Saudi learned their lesson in the 80s that they cant cut continuously to prop up prices. Someone else will fill the void they leave with higher cost production. The fact that for decades they've sat on 1-2MBPD of spare capacity that cost billions to explore and construct is crazy enough. I never understood why it was their responsibility to manage global supply shocks.

[burn_this_city]

Also the fringe benefit of waging economic warfare on Iran and Russia makes their price crash seem even more logical.

[nik-]

Originally Posted by Kavvy

Ok, as I can't tell from your post - we are not victims,

We, like most nations, pump as most oil as we can get to market - Saudi was really the only ones holding back.

don't disagree with the guaranteed income comment however.

meh. Our industry has been savaged by a single country's decision that produces almost 3 times a day what we do. We have no control over their output and their output adversely affects us.

Victim works.

[Kavvy]

Originally Posted by nik-

meh. Our industry has been savaged by a single country's decision that produces almost 6 times a day what we do. We have no control over their output and their output adversely affects us.

Victim works.

Ha, it just comes across really pathetic when we call ourselves a victim when we are clearly not.

I truly don't understand why anyone would expect them to produce less - if we have our own nation under control and built the infrastructure, we would produce as much as dam well could.

[nik-]

I don't know, I think if we were producing so much that we tanked the price of our product that we'd scale back to get a reasonable price for it.

I'd hope we were that smart.

[Bill Bumface]

Yeah! We'd never outpace demand at our own peril!

[Dan02]

So western Canada increased production 1.5 million over 14 years. The US increased production 4 million over 4 years. One definitely is gonna have more of a impact then the other.

[Bill Bumface]

Originally Posted by Dan02

So western Canada increased production 1.5 million over 14 years. The US increased production 4 million over 4 years. One definitely is gonna have more of a impact then the other.

Yup, up 75% in 4 years, but everything is someone else's fault.

[CliffFletcher]

Originally Posted by nik-

I don't know, I think if we were producing so much that we tanked the price of our product that we'd scale back to get a reasonable price for it.

So you're suggesting the U.S. government should step in and scale back shale production?

[nik-]

I'm speaking from a Canada centric point of view

[GGG]

What's happening now is how a free market should work. Capitalism is what's happening now. Cartel behaviour is not really part of the capitalist ideal.

I find it ironic that people who are right wing blame Saudi Arabia for the price crash. Blame them for the boom. The crash occurred because the world got over supplied because people made poor investments which allowed more oil to be produced. The book is what was false. The crash is the free market consuming bad capital.

The longer this goes the better it is for oilsands. They are long term and capital intensive so even if the companies go bankrupt the assets are worth a lot and will be picked up by someone.

Shale on the other hand requires a strong short term market and continuous capital injection to spend. So if the current well can't fund the next well the whole thing crashes.

Shake does put a hard cap on the price of oil at around $80 for the foreseeable future though. The Saudis know this so they want to crush the shake guys until banks won't lend them money for fear that the Saudis will tank price again. This way the price goes back to 80 and the Saudus have a few more million barrels in market share.

[Enoch Root]

Originally Posted by GGG

What's happening now is how a free market should work. Capitalism is what's happening now. Cartel behaviour is not really part of the capitalist ideal.

I find it ironic that people who are right wing blame Saudi Arabia for the price crash. Blame them for the boom. The crash occurred because the world got over supplied because people made poor investments which allowed more oil to be produced. The book is what was false. The crash is the free market consuming bad capital.

The longer this goes the better it is for oilsands. They are long term and capital intensive so even if the companies go bankrupt the assets are worth a lot and will be picked up by someone.

Shale on the other hand requires a strong short term market and continuous capital injection to spend. So if the current well can't fund the next well the whole thing crashes.

Shake does put a hard cap on the price of oil at around $80 for the foreseeable future though. The Saudis know this so they want to crush the shake guys until banks won't lend them money for fear that the Saudis will tank price again. This way the price goes back to 80 and the Saudus have a few more million barrels in market share.

so which is it?

[Kavvy]

Originally Posted by Enoch Root

so which is it?

They are both right.