NZ Oil & Gas (NZO)

[Mick100]

Yes, in 1979 when iran and iraq went to war and ceased exporting oil, saudi arabia ramped up production from 3m bpd to 8m bpd - ie, there was plenty of spare capacity - that's no longer the case.
.

[Dr_Who]

OMFG!

Crude brent hit a record 87.71 this morning!!! Time to buy a scooter, but then my energy stocks will cover the petrol cost for my cars.... LOL

[Seti]

Why would you or anyone else need to pay $4 a litre if you had no job to go to or couldn't afford basic foodstuffs. That is the bigger picture of $150bl oil prices - 1930's style global depression. Then the price of crude will tumble so you can afford to use it in lanterns to spin yarn by at night while waiting for the hunter-gatherers to return with the evening meal.

[digger]

facts: oil shale provides .0001 of World Energy
:Oil shale contains 1/10 the energy of Oil
:Oil shale contains 1/6 the energy of coal
:$500m electricity expense per year to produce 100,000 barrels of oil shale per day....
:60% of worlds oil shale in Colorado and Utah...
Oil shale is capital intensive, inefficient, messy, a big polluter, consumes a massive amount of energy to produce....( 3 barrels of water for every barrel of oil)...
Shells scientists have concluded that "blasting, digging, hauling, roasting, disposing, and revegetating millions of ton of shale ore would never be economically viable or environmentally acceptable


That was a great report SC. However you could have summed it up very quickly on the fact that ROEI is negative and no-one knows how to bring it into positive territory
I find it somewhat a puzzel how people go on about all this oil and it will never run out. If in fact they changed there thinking away from oil in the ground to net oil flows to the pump ,they would quickly see the problem. Oil shale from my readings have a ROEI even worse than corn ethanol,which is just a subsidy game and is adding nothing to the energy net gain.

[shasta]

Just out for the Oil bulls...all good for NZO

Oil surges to record US$88 a barrel
New 7:30AM Wednesday October 17, 2007

Oil thundered to a record above US$88 a barrel this morning (NZT), extending a nine-dollar rally since last week driven by tight supplies, strong demand and growing tensions in northern Iraq.

Oil is closing in on the inflation-adjusted high of US$90.46 seen in 1980, the year after the Iranian revolution and at the start of the Iran-Iraq war. Prices this year have averaged US$67 a barrel.

At 1555 GMT, US crude was up US$1.92 at US$88.05 a barrel. London Brent was up US$1.60 at US$84.35 a barrel. Oil has set a series of records over the past three days.

The Organisation of the Petroleum Exporting Countries said it was worried by the record run but said it was due to rampant speculation by big money investors, not any physical shortage of crude supply.

"While the Organisation does not favor oil prices at this level, it strongly believes that fundamentals are not supporting current high prices and that the market is very well supplied," it said in a statement.

Investors themselves have cited rising tensions between Turkey and Kurdish separatists in northern Iraq, sturdy world energy demand growth, tight inventories in consumer nations heading into winter and unprecedented weakness in the US dollar.

"There's a lot of risk there and that is being reflected in the price," said fund manager David Dugdale of MFC Global Investment Management.


"This market has it all right now," said Peter Beutel, president of energy trading consultant Cameron Hanover. "It has supply concerns, projected increases in demand, dollar weakness, momentum and political fears."

The Turkish cabinet asked parliament Monday for permission to launch an attack on the separatists.

Iraqi oil exports via Turkey have been sporadic since 2003, although Turkey is also now a major conduit for Caspian oil exports to the Mediterranean.


But some analysts leaned toward Opec's view and argued the easing of a global credit crunch was a bigger factor driving oil.

Moves by the US Federal Reserve to cut interest rates and add billions of dollars of temporary reserves to the banking system have added liquidity that is finding its way into oil, seen by some as a one-way bet.

"We suspect massive long-side commitment by sidelined money has had more to do with it," said Edward Meir of MF Global.

Oil has climbed from below US$70 in mid-August and surged 10 per cent since Oct. 9. The rally has also been aided by fund buying as a hedge against a weaker dollar. Gold hit a 28-year high and platinum breached record levels.

"The market fundamentals are in balance. There is too much money coming into the market," Indonesia's Opec governor Maizar Rahman told Reuters.

Opec officials said they had heard no discussion within the organisation about raising output beyond the 500,000 barrels per day agreed in September, which takes effect on Nov. 1.

Oil prices have more than quadrupled since 2002 and climbed 43 per cent since the start of 2007.

"Barring a massive sell-off, the path of least resistance seems to be higher still, although like many others out there, we are hard-pressed to justify such high valuations," MF Global's Meir said.

"Still, we learned long -- and many dollars -- ago that it is best not to take on a speeding freight train."
- REUTERS

[Sehnsucht888]

Big article in the Dominion post this morning. Refering to David Salisbury plugging the company with brokers etc over the last couple weeks- and a lot more..

[Nitaa]

although i am heavily weighted in oil stocks.. i have been for the last 5 years. I am expecting a signicant correction (around the 25% mark in oil prices when the correction occurs) by years end. This will of course still make the oil price relatively high. Like most corrections its only short lived. That is when we will see a huge spike imo over the next couple of years then the almighty crash..

im not trying to be pesimistic but history always repeats itself no matter what the commodity. Oil will be no exception.

Back to NZO. Short term the rise in oil is reaping in about $US1.0m ($NZ1.35m) every 2 days in revenue at current levels. No wonder NZO can afford 25 geek geo scientists onto their pay register. The numbers to come out in the next quarter will make interesting reading.

NZO is going from dog to darling this year. macdunk..where art thou.. this is your calling and its ok to change your mind

[Dr_Who]

It has broken through the resistence price of $80 and heading north. Maybe someone can post up a better graph that goes back 5-10 years?

[Mr Tommy]

NZOG on the hunt for funds and offshore oil fields
By NICK SMITH - Independent Financial Review | Wednesday, 17 October 2007


New Zealand Oil and Gas is seeking more oil assets and is prepared to look offshore.

With a new chief executive and oil revenues beginning to flow, the company has set itself the ambitious target of nearly doubling next year's production of more than 1.1 million equivalent barrels of oil in just four years.

"We're going to have to look at asset and corporate acquisition," says David Salisbury, a 40-year-old Taranaki native raised in the 1970s when Bill Birch's Think Big scheme pumped millions into provincial New Zealand's economy.

Salisbury, six months into the job and having seen subsidiary Pike River Coal successfully floated, says growth will come solely from NZOG's core business exploration, development and production of oil and gas.

Existing sources will peak around 1.3 million of barrels of oil equivalent in 2010, tailing off to just over 1 million in 2012 and 750,000 in 2015.

NZOG is confident of exploiting its existing Taranaki prospects but even so, for the equivalent of two million barrels by 2012, it will need to go to the market for funding to buy.

"The exploration we're looking at is New Zealand focused at this stage. We're going to have a very strong go at growing and we want it in meaningful tranches."

The high level of inherent risk and investment needed by the industry requires a sustained return.

"That's what makes us look at acquisition."

The company is working on a number of strategies to fund future acquisition. Much depends on the size of the target but Salisbury says it could include further debt, going to the equity market, share placement, issuing equity to another company or even forward selling oil production.

On the government's new energy strategy putting a 10-year ban on state-owned gas or coal-fired power plants, he says there is still a strong domestic need for gas and "any gas we find will find a home".

"It certainly doesn't put NZOG off from further exploration."

For a company that recorded revenue around $18 million last year "it was a series of one-offs" and whose production only started properly this year, its chief executive is bullish.

Are peak oil prices causing a rush of blood? "It's not a bad rule of thumb to look at a barrel of oil as being worth about $100," is his riposte, noting many expect the price of oil to top US$100 a barrel this year.

It costs hundreds of millions of dollars to develop a site but at those prices ``we expect the fields to be profitable for up to 10 years".

"This year we've already sold around 300,000 barrels of oil." By financial year's end it will be just shy of 1.2 million $120 million by Salisbury's rule of thumb.

The company has a record of moving quickly. While the Tui field is based on decades of data, actual oil discovery was recent: "To go from discovery to production in a four-year window is very, very good going."

Tui has transformed the company. "While we're not going to acquire Shell in the next couple of years'' it is suddenly earning significant cash.

How significant? In August, Statistics New Zealand recorded its largest amount of crude exports for one month. August also broke the record for receipts to Australia, our largest trading partner.

"September's presumably going to do the same."

It's not just Tui but Kupe, ``which most people think is only a gas field".

Gas is great but its off-products are more profitable. While Kupe holds 254 petajoules of gas, it will also produce 1.1 million tonnes of LPG and, more importantly, 14.7 million barrels of condensate, a light oil similar to the top-shelf product produced by Tui.

Kupe is on track for production in mid-2009, Salisbury says.

The 30 kilometres of pipeline connecting the well-head to the production station is at Port Marlborough and is ready to be welded and installed. The "jacket" the legs of the platform are in Port Taranaki. The platform top will be finished in Thailand and shipped to New Zealand by the end of the month.

It's Tonka toys times ten: "When you spend $1 billion, you get some pretty pieces of kit."

[upside_umop]

sc,

i think i backed myself up in my posts why oil shale was not yet viable.
refresh:

-oil companies lost billions in the 70's (yes billions in the 70's was a lot of money) when oil price crashed and it became uneconomic again and all their capex was a waste of time - they dont want to do this again until they know poo is sustained.

-your thinking of the old way they tried to extract oil from the shale..ie dig it up, take it to a factory, roast it etc etc..but seem to be mixing it up with the new way in which i was talking about.

like you said, shell has a new way which they're not letting out too much detail.
what they have let out is:

-they done a 'small' test plot scheme and have pumped 1600 barrels a day of some of the sweet crude they know of. no heavy refining. messy? no

-the energy input is 1 unit in and 3.5 units out.

-yes, they have to use ice wall technology, as has been used for years to isolate flows into mines.

-they WOULDNT be using electricity heaters down there, why use gas to convert to electricity then back to heat again? thats very inefficent sc, i think they would just use gas or even the oil from onsite, rememember 3.5 units return for every one unit used. its almost a perpetual motion device!

the only thing i have read is that shell isnt sure their heaters are reusable, which could be expensive...they didnt give figures though.

there is 1 million barrels per acre, 1 billion per square mile. 2000 square miles of this land. 2 trillion barrels. it will happen one day, but your right, wont happen tommorow.