Comments on: Will Mexico Follow Chavez?

By: John Sterling

John Sterling — Wed, 22 Oct 2008 13:24:24 +0000

A petroleum engineering acquaintance of mine confirmed to me that the production from the Cantraell field is “crumbling.” He estimates that if international oil firms took over for Pemex, they could boost Mexico’s output by 3 million b/d in fewer than five years.

By: HTRN

HTRN — Thu, 10 Apr 2008 02:22:43 +0000

Some of you might be interested to know that they’re reopening the worlds first commercial oilfields. Once again, oil will flow enmasse in Oil City Pennsylvania. Apparently that the field was not economical to exploit at low prices but at $100/barrel, it makes sense. It’s been reported that almost 60% of the original oil deposit is still waiting to be pumped out.

By: Mike C.

Mike C. — Thu, 10 Apr 2008 01:35:17 +0000

Hydrocarbons in place (OIP, GIP) is static. "Reserves" is a strictly economic number. The general press usually flubs the difference.

Mexico has a special problem over and above even Venezuela and most ME countries, in that not even private Mexican companies, much less foreign companies, are allowed to enter the oil business as interest owners. That is banned by the constitution. We are now on our second Mexican president that would like to change that, but who has not even a snowball's chance in hell of doing so. They are well and truly screwed. That's a damned shame, because they could be doing much better, both in maintaining rates from existing fields, and in exploring for new ones, if they only had the capital backed by the technical knowledge. IF they could change that law, Mexico would overnight become the hydrocarbon industry's # 1 choice for foreign investment, gar-on-teed.

By: Technomad

Technomad — Tue, 08 Apr 2008 22:53:36 +0000

I've always thought that foreign countries' nationalization of US firms should be treated as a de facto declaration of war.

"They thought that Uncle Sam was a clod,
They're under the Yoke now, or under the sod,
Consigned there with a friendly prod
By Sweeney Todd,
The Demon Barber of Fleet Street.
Swing your razor wide, Sweeney!
Hold it to the skies!
Freely flows the blood of those
Who nationalize!"

By: Jim T

Jim T — Tue, 08 Apr 2008 20:32:05 +0000

Right on brother! I remember reading the late Jude Wanniski where he notes that, as of 2004,

"In the entire history of the world oil industry, a total of 4.6 million wells have been drilled, with the US accounting for 3.2 million of those!
Africa is four times the size of the US (minus Alaska), yet in the last eight years there have been only 6,280 wells drilled on the continent while 209,400 have been drilled in the US.

There is undoubtedly as much oil in Africa undiscovered as there has been produced in the history of the world oil industry.

The same can be said for Latin America. As for the Middle East, Saudi Arabia has drilled only 1,000 wells in the past eight years, almost all of them production wells, not exploratory wells.

Iraq, with the second highest total amount of proven reserves - 110 billion bbl - has drilled only 100 wells over that period.

"Oil is of course the most important commodity in the world. For the world oil industry to stop investing in its development for almost three years was a shocking lapse"

Which brings us back to the original question: If there is so much oil in the world, why is the price so high? The answer, simply, is that from 1998 to 2001, the world energy oil industry went on vacation."

For some reason, Google says his old site may be harmful but I have been visiting that site for nearly 8 years with no problems. Old Jude may have been considered "out there" by some but I've always appreciated his point of view.

http://www.wanniski.com/showarticle.asp?articleid=3941