Oil Stock Report

[alfaspider]

Thanks-- will read further. Had heard that CO2 reduces viscosity, and may enhance EOR- but this post contained info regarding extra costs of CO2..

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" All of the best EOR projects in the Permian Basin have been implemented. Those that remain are more economically cnallenging. The cost of CO2 has risen dramatically due to demand and the rise in oil prices. It takes 10 to 15 mcf of CO2 @ $2.50 to $4.00/mcf to produce a barrel of oil and the operating costs associated with a CO2 flood are also extremely high due to the corrosive nature of CO2 and the need for a recovery plant to strip the produced CO2 for re-injection. Add to that the hugh up front capital requirement to implement the project and the long delay between beginning injection and corresponding oil production and you can see why this has always been a game played by Major oil companies with deep pockets and all the necessary technical skills.

All that said, I'd be surprised if anyone could pay $100k per net producing barrel for these assets. Whether the "reserves" are technically there or not is not really the issue here, its more of a matter of the economics of extracting the oil. That is why no successful buyers have come forward for these assets even when oil was selling north of $140/bbl.

There is still some hope of a sucker coming forward that thinks they are smarter than the previous operators and can make a silk purse out of a sow's ear. I've seen it happen many times over the years. I just wouldn't bet my money on it. The other possibility is a public company paying up to buy the company just so they can put some reserves on their books and possibily use the NOL that Cano has."

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KEY PHRASE: "this has always been a game played by Major oil companies with deep pockets"- so Latimer sells it to larger Co with pockets, JMHO--..

Afraid I don't know enough about the practical economics of Water vs CO2- so reading and trying to evaluate.. Only Key point might be that if spur was constructed near the Cato field- it might make CO2 more available and cheaper to EOR the Cato field?

have to see- and not sure if Latimer or Homier could tell you anyway?