Walldog,
That's a bit harsh don't you think.
We posted(discussed) last week that you cannot calculate peak oil unless you calculate it based on a specific price per barrel.
Now I am not a geologist that specializes in reservoir engineering but in my (very humble) opinion if the price of oil stays at the $85 to $90 per barrel mark then all current projections go out the window.
The largest single hurdle in bringing oil to market is the initial infrastructure cost. These include massive gathering centers, giant pipeline and off-loading centers. There are two ways to overcome this hurdle, the 1st is to find giant reservoirs where the economics can be overcome simply by the size of the field. The second and that is what I am intoning here is when the price of oils elevates so dramatically that now fields that were deemed un-economic can now be produced.
There are literally hundreds of these fields around the world.
Some specific areas would include the North Sea, all across the North American Arctic, The huge Rocky Shale oil regions, and finally as i mentioned last week the Canadian Tar Sands.
Please understand I am certainly not sayting everything is rosy and we will have Oil coming out of our Wazzou for years to come. I am simply saying that for T-Boone to make a prediction is silly at (current posted price NYMEX) of $92.15/Bbl our reserve potential will haqve to be recalibrated.
Now in conclusion, how does any of this affect us as investors in ERHC? It looks like from the Addax presentation that the JDZ will not be one massive Elephant field but instead is a series of smaller reservoirs. This will require more capital to develop the production facilities. Additionally there may be smaller more marginal offset zones that may now be included because the economics are now viable.
So when you hear someone say we have reached Peak Oil ask them what their price basis is.
