Diesel today

[5030]

Just curious of anyone on here has any idea what the approximate cost is to punch a new oil well if it's a dry hole or not? By dry hole, I mean not productive enough to turn a profit for the driller...

I know, do you know?

 

[ultrarunner]

No... but the farm drilled two dry holes in hopes of water and lost 50k with the deep one down 800+ feet...

When the price of oil spike years back some small capped oil wells around the SF Bay Area were put back into production causing a stir... million dollar neighborhoods not aware they lived in oil country and were not happy.

 

[kenhar]

Just curious of anyone on here has any idea what the approximate cost is to punch a new oil well if it's a dry hole or not? By dry hole, I mean not productive enough to turn a profit for the driller...

I know, do you know?

A few of the drillers in Arkansas, drilling for natural gas in the Fayetteville shale said they were going down from 2500 to 3000 vertical feet, then about 5000 feet horizontal. Including the fracking, about $4 million per hole, with no problems.

 

[jyoutz]

If anything, prices will slowly rise at the pump. The WTI price is up today. Pretty steady increase over the last month.

The Federal Reserve Board of Kansas City Energy Survey from 10/11/24 has the profitable price at $65. Headed towards the $89 price that oil companies say they need to substantially increase drilling. To stimulate the economy, the incoming nominee for Treasury Secretary wants a 3 million barrel a day increase in production, which is a 22% increase over today's 13,585,000 daily production. That is a substantial increase I would say. Based on price projections that is at least 5 years out.

Then it will take a while to increase production even if the price per barrel reached the $89 range. New wells have to be drilled just to maintain daily production as a new well's production starts declining after the first 6-12 months. You get 50% of a well's lifetime production in the first 3 years of an average 30-year life span. Our experience bears that out. Here is a graph of production from 26 of our leases totaling 33 wells for the first year. Some leases have 2 wells comingled.

View attachment 2115588

View attachment 2115587

Here are the results of the Federal Reserve Board of Kansas City Energy Survey from 10/11/24.

Tenth District Energy Activity Declined Further

View attachment 2115586

This is consistent with what local Permian Basin producers are saying; and $58 or $65/barrel is necessary for increased drilling to be economically viable. This notion that more will be produced at $40/barrel isn’t realistic.

 

[WM75Guy]

A few of the drillers in Arkansas, drilling for natural gas in the Fayetteville shale said they were going down from 2500 to 3000 vertical feet, then about 5000 feet horizontal. Including the fracking, about $4 million per hole, with no problems.

Our wells were more expensive, although the production company didn't share the exact prices. The wells are 9,000' to 11,000' deep and 2 1/2 miles in length.

 

[5030]

Bingo on the big bucks to punch a well with no guarantee it will produce enough to even break even. Drilling is always a shot in the dark.

 

[Tomtint]

If anything, prices will slowly rise at the pump. The WTI price is up today. Pretty steady increase over the last month.

The Federal Reserve Board of Kansas City Energy Survey from 10/11/24 has the profitable price at $65. Headed towards the $89 price that oil companies say they need to substantially increase drilling. To stimulate the economy, the incoming nominee for Treasury Secretary wants a 3 million barrel a day increase in production, which is a 22% increase over today's 13,585,000 daily production. That is a substantial increase I would say. Based on price projections that is at least 5 years out.

Then it will take a while to increase production even if the price per barrel reached the $89 range. New wells have to be drilled just to maintain daily production as a new well's production starts declining after the first 6-12 months. You get 50% of a well's lifetime production in the first 3 years of an average 30-year life span. Our experience bears that out. Here is a graph of production from 26 of our leases totaling 33 wells for the first year. Some leases have 2 wells comingled.

View attachment 2115588

View attachment 2115587

Here are the results of the Federal Reserve Board of Kansas City Energy Survey from 10/11/24.

Tenth District Energy Activity Declined Further

View attachment 2115586

I don't think your post will age well

 

[Tomtint]

Bingo on the big bucks to punch a well with no guarantee it will produce enough to even break even. Drilling is always a shot in the dark.

Not as much a shot in the dark as you may think.. Friend worked on a rig in the Gulf.. They know where the oil is and their drills can go down..and sideways. He told me that if one rig was in a hot spot it was common for other rigs to drill their way over to them and start sucking off the same supply.

 

[WM75Guy]

Crude oil price is up $3.00 today. Should start seeing an impact at the pump before long. Lowest station that was $2.72 is now $2.97, up with all the rest. Pump war in that town must be over.

 

[jyoutz]

Here’s some good information from another tractor forum:

Diesel mushrooms

almost everyday it seems we hear about diesel fuel contamination. so I cut and paste for s&g's i put together the following for those who have been lucky so far. Quote: Diesel bug is contamination of diesel fuel by microbes such as bacteria and fungi. Water can get into diesel fuel as a result...

www.orangetractortalks.com