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Ken Feldman

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Re: Oil and Gas Issues
« Reply #3700 on: April 07, 2020, 08:23:31 PM »
Ken, just for clarification:

In a civilized country, owners of rigs like these would be paid to scrap them, now they just stand idle waiting for the next boom in business. Is that correct?

An uncivilized country would carry on building pipelines in order to get the rigs into action again. Is that correct?

All the scrap metal from these rigs and pipelines would make for some mighty fine turbine towers, but that would be somewhat outlandish - wouldn't?

Instead of using a lot of energy to scrap the rigs and recycle them into parts for windmills, it would probably be better to use them to create geothermal energy wells to provide 24/7 baseload for intermittent renewables like solar and wind.  It appears that the same type of rigs used for oil and gas can be used for geothermal wells.  In fact, there have been times when abandoned oil or gas wells have been converted to geothermal wells.

https://www.quora.com/Can-dry-oil-gas-exploration-wells-be-converted-to-geothermal-wells-Is-this-happening-in-any-place-in-he-world-For-example-in-Morocco-where-exploration-has-been-run-for-decades-with-only-dry-wells

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Can dry oil&gas exploration wells be converted to geothermal wells? Is this happening in any place in he world? For example, in Morocco where exploration has been run for decades with only dry wells.

1 Answer
Roar Nybø
Roar Nybø, Research Scientist at SINTEF Petroleum Research
Updated Aug 13, 2014 · Author has 151 answers and 351.7k answer views
It could happen where petroleum and geothermal activities overlap, but a more common scenario is re-purposing a "spent" oil & gas well. The subsurface conditions are well-known for a spent well and it has a proven permeability, which is essential if you plan for a geothermal well that circulates fluids through cracks in the rock. Abandoned wells don't necessarily have this. The "dry wells" are also commonly exploration wells, which may not be ideal as long-term geothermal production wells.

Re-purposing spent wells for geothermal energy is also attractive because you avoid the cost of plugging and abandonment (P&A) for old wells. This is a costly procedure both on- and off-shore [5,6] and several companies are poised to take over those wells for geothermal purposes [7-9, 13]. It has even been considered to use otherwise abandoned offshore platforms in the North Sea as geothermal power plants [10]. There's some advantages to this, but a lot further off than onshore re-purposing. The equally surprising idea of drilling for fresh water from offshore rigs [11] is probably easier in terms of existing technology.

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In The Netherlands, a typical geothermal well also tends to produce some oil and gas. This is an issue of concern, as it means the geothermal operator need to aquire the same set of safety equipment and know-how as oil and gas operators, to avoid spills and blowouts [2]. This wouldn't be a problem if those drilling the well work in both the geothermal and oil & gas regime. In fact it has been suggested that drilling locations in The Netherlands should be aimed at hitting both petroleum and geothermal heat, so that the inevitable dry wells will at least be in a favourable spot for geothermal heat. As far as I've gathered, this business case is being hampered by Dutch law, where you apply for separate licenses for a geothermal and an oil & gas well. There is no "I'd like to drill a hole and see what I find, please" license.

gerontocrat

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Re: Oil and Gas Issues
« Reply #3701 on: April 07, 2020, 09:43:48 PM »
The US President will let the markets decide.  As the price of oil is currently lower than the cost to produce it in most US oil patches, this is not good news for the fossil fuel extractors.

https://oilprice.com/Energy/Energy-General/Trump-Free-Markets-Will-Determine-US-Oil-Production.html

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Trump: Free Markets Will Determine U.S. Oil Production
By Irina Slav - Apr 07, 2020

U.S. President Trump believes local oil production output cuts will happen automatically thanks to the nature of the free market, he told reporters this week.

“I think the cuts are automatic if you are a believer in markets,” Trump said at his daily coronavirus press briefing. He also added that the U.S. had not been officially asked to take part in any production cuts.

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One could argue that Trump’s call on OPEC and Russia to cut production goes counter to his belief in the free market, but it is also true that U.S. producers would be forced to cut output with or without an international agreement if their breakeven prices are higher than the price at which oil is actually trading.
Trump - he speak with forked tongue.
"Para a Causa do Povo a Luta Continua!"
"And that's all I'm going to say about that". Forrest Gump
"Damn, I wanted to see what happened next" (Epitaph)

Ken Feldman

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Re: Oil and Gas Issues
« Reply #3702 on: April 08, 2020, 12:46:21 AM »
Here's a good article explaining how the Covid-19 recession and the economic stimulus to combat it will result in an increased market share for renewables over gas and oil.

https://www.reuters.com/article/us-column-russell-health-coronavirus-cli/renewable-energy-wins-over-oil-and-gas-in-post-coronavirus-world-russell-idUSKBN21P0L5

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April 6, 2020
Renewable energy wins over oil and gas in post-coronavirus world: Russell
Clyde Russell

LAUNCESTON, Australia (Reuters) - Imagine waking up one morning with a deadly tiger snake in your bed. To make matters worse out of the window you notice an approaching bushfire.

Both are a threat to your life, but you are going to deal with the imminent danger of the snake first, and then tackle the more distant but still serious fire. It’s the same with the new coronavirus and climate change.

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But this ignores the fact that at some point the world will contain the pandemic, and climate change will once again become a driving influence in the debate on the future of energy.

The coronavirus is also likely to change the market dynamics of the various types of energy, and mostly in favour of renewables such as wind, solar and hydropower.

The outbreak had already wrought radical change in two different ways. The first is that the oil and gas industry has been shaken to its core, while the second is that the cost of capital is at record lows, and there will be billions of dollars of stimulus spending looking for a home.

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While it’s likely that both crude and LNG prices will recover in the coming months and years as demand growth resumes, it’s also likely that the trajectory will be lower.

Previous experience of price collapses shows it takes several years for a full recovery to eventuate, mainly as demand has to recover, or supply has to adjust lower in order to achieve a balanced market.

For crude and LNG what this means is that much of the investment that had been planned before the coronavirus struck will be delayed or even scrapped.

Up to $210 billion of planned oil and gas investments are now at risk from the coronavirus, consultants Wood Mackenzie said in an April 2 research note.

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The biggest costs for utility scale wind, solar and battery storage projects are the upfront capital, given that once these projects are operating costs tend to be minimal.

With central banks flooding the system with cheap cash and governments likely to be keen to pursue stimulus projects once the coronavirus lockdowns are lifted, renewables should be able to capture an increasing share of this investment.

In Western countries, renewables are popular with the most of the populace, while fossil fuel plants such as coal and natural gas units have largely lost the public relations battle and are seen as part of the carbon emissions problem.

In developing nations such as India, Vietnam and others in Asia and Africa, renewables will likely be significantly cheaper and faster to build and connect to electricity grids than conventional fossil fuel power plants.

kassy

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Re: Oil and Gas Issues
« Reply #3703 on: April 08, 2020, 06:41:57 PM »
Thanks for keeping up the service in these times!  ;)

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The task force recommended shutting down the last coal-fired power plant by 2038 at the latest. The government has since moulded the proposal into legislative drafts. The coal exit law does not require the consent of federal states. The legislative process is currently held up by the impacts of the coronavirus pandemic. Zaremba writes that it is unlikely that the law will undergo major changes in the Bundestag.

https://www.cleanenergywire.org/news/government-rejects-state-demands-changes-coal-exit-law

So there is some fight between the states and the German government about the coal exit.
If any german member could chime in on more specifics that would be great.
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Ken Feldman

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Re: Oil and Gas Issues
« Reply #3704 on: April 08, 2020, 08:40:08 PM »
The production declines are starting in the North Dakota (mainly Bakken) oil patch.

https://www.jamestownsun.com/business/energy-and-mining/5034716-ND-oil-production-slumps-from-coronavirus-crisis-price-war

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ND oil production slumps from coronavirus crisis, price war
Written By: Patrick Springer | Apr 8th 2020

FARGO — Production in North Dakota’s Oil Patch has slumped by an estimated 175,000 barrels daily — down from 1.4 million barrels daily — from the “double whammy” of plunging demand from the coronavirus crisis and a glut caused by a price war.

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The number of drilling rigs operating in the Oil Patch has dropped 35%, from 53 to 35, with an optimistic forecast that the rig count could hold between 25 to 29 as producers struggle with low prices and demand, said Ron Ness, president of the North Dakota Petroleum Council.

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Operators will need access to capital — $120 million, by Ness’ estimate — to maintain oil production, a lifeline that is difficult to sustain with low prices and demand, Ness said.