Energy Prospectus

I noticed that the newsletter included a comment indicating that fracking would need $100 oil pricing to work elsewhere...could you help me out and explain...........thanks

The primary reason the U.S. shale plays have developed so quickly compared to the rest of the world are:
> Private ownership of mineral rights.
> The oil shale plays (Bakken, Eagle Ford and Permian) are all in areas that already had a lot of infrastructure. This should not be a surprise since the shales are the source rock for all the producing zones above them.
> Plus, the geology was already well known. For example, there were thousands of wells drilled through the Eagle Ford before horizontal drilling was possible. There is also plenty of seismic available in all of the U.S. shale areas.
> The Bakken, Eagle Ford and Permian are in North Dakota and Texas, two states with a long history of working well with the industry. If they were in New York they would never have been developed. BTW some of the best rock in the Marcellus Shale is in southern New York, a state that will not allow fracking.

For example, Australia has some great shale plays but they are in the middle of nowhere, with no roads or pipelines.

Most of the large rigs necessary to drill big horizontal wells are in the U.S. The last time I looked Australia had less than five rigs capable of drilling horizontal wells and only two frac spreads.

Did you know that 25% of the world's drilling rigs work in Texas?

Thus, it will take much higher oil prices to justify the HUGE capital outlay necessary to even start developing the shales outside of North America.

Once again thanks for sharing all your knowledge of how the energy industry works!!