Are On Search Energy Bubbles That Are Leaking Air Page
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I learn the truth I'm sure that the end will leave me crying, leave me
Fracked Up Bubble
There’s only one thing wrong with all the predictions of a revitalized
United States energy superpower flooding the world with its shale oil
and shale gas.
It’s based on a bubble, on hype from the usual Wall Street spin
doctors. In reality it is becoming increasingly clear that the shale
revolution is a short-term flash in the energy
pan, a new Ponzi fraud, carefully built with the aid of the same
Street banks and their “market analyst” friends, many of whom brought
us the 2000 “dot.com” bubble and,
more spectacularly, the 2002-2007 US real estate securitization
bubble. A more careful look at the actual performance of the shale
revolution and its true costs is instructive.
End Of The Shale Bubble!
Leases on undrilled shale
fields were bundled and flipped on the basis of grotesquely inflated
claims of their income potential;
newly minted investment vehicles of more than Byzantine
complexity—VPPs, "volumetric production payments," are an example
Hofmeister, the former chief of U.S.
operations for Shell, sounding an alarm?
"Unless something seriously changes in the next five years," he said in
an interview, "we'll be standing in gas lines because there won't be
enough oil to go around."
Mr. Hofmeister said he believes forecasts also understate the "decline"
rate of shale fields.
The hydrocarbons tend to flow robustly in the first months of drilling,
then decline before plateauing at lower levels.
To sustain growth, companies will need to drill many wells at a rate
"beyond the capacity of the industry as currently defined," he says.
"Those who ballyhoo oil shale and say that this will take care of
us—no, it won't."
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