“Under IP address 159.53.78.140, you publish under multiple names (DMR, Matt, Monty Burns, Contrarian) , bad email address, no ID, no website.”

Well, considering that IP address is a JP Morgan Chase gateway, it could be any number of people from the company. The Big Picture must be some popular reading at JP Morgan during lunch.

And it’s not as if they haven’t been trying: their capital and exploration expenses for upstream operations have nearly doubled in recent years.”

http://suddendebt.blogspot.com/2008/04/crude-facts.html

I think one can almost assume that it’s a matter of time before these methods are used in Canada.

Oh and as regards a prior post of yours (different grades of crude). I was reading some piece on an independent US refiner somewhere in the Middle US (by which I mean from Texas to Montana) that had had the foresight to rig out their refineries for the extra beating that heavy oil produces.

And there’s a non-trivial quantity of heavy oil in places like Wyoming and Montana. There’s been a mini-boom with lots of new rigs put in, and the refiner in question is one of the few that can handle their output and is making money hand-over-fist.

Wyoming/Montana would make sense to me since that’s where the Powder River Basin is. And the world’s largest coal mine. More US coal now comes from here than from Appalachia.

Think the Ghawar of coal.

Athabascan, and potenially Orinoco, production might benefit from newer in-situ recovery methods such as toe to heel air injection (a thermal recovery technique with much lighter footprint).
Here’s a piece from Oil Drum Canada:
http://canada.theoildrum.com/node/2907#more

Exactly, and if you look at inventories by PADD, it’s evident that nearly all of the total draw is accounted for by PADD 3 (U.S. Gulf Coast).
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The WSJ seems unconscious to the fact that consumer demand within some importing nations has not been exactly booming while many exporting nations subsidise domestic demand. Beyond which there’s some implication of a generic ‘world oil’, no matter that there are many different grades within a reference formula structure with benchmarks’ price discovery taking place in financial markets.
Too many still imagine there was/is some strict supply/demand; price relation — even though this hasn’t held for nearly a century (or more). Instead it has been a matter of distinct price regimes and who/what dominated these. Price management, whether decades ago by the so-called ‘international oil cartel’ or by OPEC or by financial interests does not have much to do with free market orthodoxies, though the current regime is often referred to as “market-related”.

Feeding Chinese demand is a big factor. There are several major oil refineries under construction that will dramatically increase Chinese oil imports (and consumption) in the next 10 years. In just the past 14 years China has gone from self-sufficiency to importing over 3 million barrels per day last year. This is going effect prices for a long time.

When you include the Athabasca tar sands, Canada’s reserves are second only to Saudi Arabia. Now one caveat is that not all of that is recoverable with current methods. But huge amounts are. And, as I investigated it, predictions that Canada will go from 1 b bbl/yr to 3 – i.e. tripling their output – seem very realistic.

Another problem/caveat though (let’s put as many facts up front as possible) is that the current methods are very water (and energy) intensive. Northern Canada has plenty of water but some people are already worrying that water availability is going to impact oil extraction from tar sands.

In sum though, I don’t think Canada is going to peak anytime soon.

Ghawar may be in decline (and if so, generally it’s steep) although the Saudis would of course never cop to this.

But the Saudis (and their Am and European precursors) having been going at Ghawar for a long time. The Canadian tar sands have been barely touched.

The point is to buy ourselves time while we hopefully get a better handle on energy consumption in general and develop new technologies. Without a collapse of the world economy. A conservative guess is that a ’sufficient’ collapse of the world economy would require a reduction of the current 6.6 billion world population by, let’s say, 25-50 percent (and the longer the collapse, the more the reduction).

Russia is at least considering changes in these oil export duties and there are efforts by the Mexican gov’t to loosen restrictions on foreign investment but this is still very politically sensitive. Venezuela’s PDVSA can’t invest because it has to spend on social programs. Russia’s Gazprom, for that matter, has to pay for a winter olympics in 2012.

Finally, even the private companies’ incentives have not changed as dramatically as prices have increased. This is because of capital budgeting constraints. Exxon is famous for being very conservative in its capital budgeting having learned very hard lessons from the 1980s oil bust. The market has consistently rewarded this approach with a very high price/bbl reserve ratio. Most of the private majors invest in projects that are profitable at relatively low prices. These use to be set as low as $18-20 bbl at the beginning of the decade. You hear that there are some investments made on $50/bbl price assumptions but that’s about it. Even at $50/bbl much of the potential new deep sea production wouldn’t be profitable. Keep in mind, these prices need to materialize through the 20+ plus year life of the project so spot prices are not a particularly useful gauge.

If Canada goes to 3 bil bbl/yr that translates to 8.22 m bbl/day. In a currently (approximate) market of 85 m bbl/day.

Which is huge.