trading range, page-4

BigAl,


I can't argue with any of the points you made about Linc, they need to get oil flowing and UCG deal signed and get the money rolling in. But your ref to the recent $1.5 trillion oil find, I do have an issue with.

"(2) Oil prices are dropping re Siria tensions easing. Oil demand is also fairly flat and there has just been a huge new oil find in the Gulf of Mexico.
Some analysts are predicting $85 a barrel.

http://www.examiner.com/article/1-5-trillion-oil-massive-crude-oil-well-found-gulf-of-mexico-drill-pipes?cid=rss "

I am quickly coming to the conclusion that any reporter who quotes oil reserves/resources in dollar terms, doesn't know what they are talking about, and aren't worth reading.

The Lower tertiary trend in the Gulf of Mexico, is a "trend" not a distinct field. The $1.5t /$100=15b barrels of oil has been the number thrown around by Chevron when in 2007 they managed to get their Jack #2 well to flow oil in about 9000 ft of water. I see the production platforms will be on line next year. Most of the 15 billion barrels are yet to be discovered resources, and if they manage to find this oil, it ain't going to be cheap. Just like Linc's $20t oil in the Ark basin.

The original article came from Bloomberg,
http://www.businessweek.com/news/2013-09-12/wildcatter-hunch-unlocks-1-dot-5-trillion-oil-offshore-u-dot-s-dot-energy#p1

Page 3 has some interesting discussion on sub salt, worth a read for those interested in Linc's up coming sub salt well.

All the high profile new oil production, deep water Shale oil, currently coming on line around the word, is expensive oil and most has extremely high decline rates. If the oil price drops, the oil stops coming on line and production drops fast. Supply will not meet demand thus pushing the price back up again. Any drop in the price of oil will only be very short term, much to the disappointment of many wishing for the good old days of cheap oil.