{"id":6434,"date":"2015-03-12T05:45:51","date_gmt":"2015-03-12T10:45:51","guid":{"rendered":"http:\/\/olduvai.ca\/?p=6434"},"modified":"2015-03-12T05:45:51","modified_gmt":"2015-03-12T10:45:51","slug":"exxonmobil-ceo-wrong-about-resilience-of-tight-oil-production","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=6434","title":{"rendered":"ExxonMobil CEO Wrong About \u201cResilience\u201d Of Tight Oil Production"},"content":{"rendered":"<h3><a href=\"http:\/\/oilprice.com\/Energy\/Natural-Gas\/ExxonMobil-CEO-Wrong-About-Resilience-Of-Tight-Oil-Production.html\" target=\"_blank\">ExxonMobil CEO Wrong About \u201cResilience\u201d Of Tight Oil Production<\/a><\/h3>\n<p>ExxonMobil CEO Rex Tillerson is wrong about the resilience of U.S. tight oil production.<\/p>\n<p>Last week,\u00a0<a href=\"http:\/\/www.wsj.com\/articles\/exxon-mobil-shale-to-the-chief-heard-on-the-street-1425568380\">The Wall Street Journal<\/a>\u00a0reported:<\/p>\n<p><em>\u201c\u2026Mr. Tillerson pointed out that the collapse in natural-gas prices similarly had led the number of rigs drilling for that fuel to drop to 280 from north of 1,600 in 2008. Gas output jumped 50% in that time, he said. That is what you call resilience\u2026While he didn\u2019t see a perfect parallel between shale gas and shale oil, he said there were \u201clessons\u201d to be learned.\u201d<\/em><\/p>\n<p>His point is that we should not expect a big drop in U.S. tight oil production just because the rig count is falling. He bases this prediction on what happened with gas production in 2008-2009 and afterward. That is wrong.<\/p>\n<p>The fact that gas production didn\u2019t decrease much in 2008-2009 despite a huge drop in rig count is incorrectly attributed to the high productivity of shale gas wells. The truth is that shale gas wasn\u2019t a big component of total gas production at that time.<\/p>\n<p><a href=\"http:\/\/oilprice.com\/Energy\/Oil-Prices\/Rig-Count-Irrelevant-As-US-Output-Continues-To-Soar.html\"><strong>Related:\u00a0Rig Count Irrelevant As US Output Continues To Soar<\/strong><\/a><\/p>\n<p>Let\u2019s look at the rig count drop in 2008-2009. The chart below shows the various components of U.S. gas production and the gas-directed rig count.<\/p>\n<p><a class=\"lightbox\" href=\"https:\/\/oilprice.com\/images\/tinymce\/Evan1\/ada1929.jpg\"><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/oilprice.com\/images\/tinymce\/Evan1\/ada1930.jpg\" alt=\"NatGasProd07-14\" width=\"450\" height=\"308\" \/><\/a><\/p>\n<p><em>Natural gas production components and gas-directed rig count, 2007-2014.<\/em><\/p>\n<p><em>Source: Baker Hughes, EIA, DrillingInfo and Labyrinth Consulting Services, Inc.<\/em><br \/>\n<em>(click image to enlarge)<\/em><\/p>\n<p>The gas rig count fell from 1,601 in September 2008 to 675 by July 2009. By September 2009, gas production had decreased about 4.5 Bcf per day (4.5% of total). Shale gas only amounted to 12% of total gas supply at that time.<\/p>\n<p>&nbsp;<\/p>\n<p>&#8230;click on the above link to read the rest of the article&#8230;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>ExxonMobil CEO Wrong About \u201cResilience\u201d Of Tight Oil Production ExxonMobil CEO Rex Tillerson is wrong about the resilience of U.S. tight oil production. Last week,\u00a0The Wall Street Journal\u00a0reported: \u201c\u2026Mr. Tillerson pointed out that the collapse in natural-gas prices similarly had led the number of rigs drilling for that fuel to drop to 280 from north [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[3],"tags":[1041,595,4121,723,798,2952],"class_list":["post-6434","post","type-post","status-publish","format-standard","hentry","category-energy-2","tag-exxonmobil","tag-oil-production","tag-rex-tillerson","tag-shale-oil","tag-tight-oil","tag-tight-oil-production"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/6434","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=6434"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/6434\/revisions"}],"predecessor-version":[{"id":6435,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/6434\/revisions\/6435"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=6434"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=6434"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=6434"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}