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Gold/Mining/Energy : Strictly: Drilling and oil-field services -- Ignore unavailable to you. Want to Upgrade?

To: BigBull who wrote (58589)	1/16/2000 10:34:00 AM
From: Crimson Ghost	Respond to of 95453

Interesting post from another thread. I don't know if the author knows what he is talking about, but should still interest people here. " We've got an oil industry that has been experiencing problems. 2 desperate refineries have been in such production problems that they've had to go onto the open markets and buy gasoline at high premiums to cover their contractual obligations to their wholesaler/jobbers. These and other refineries have seen their incident rates of problems increasing and reportedly again due to embeddeds. IN fact, it is still too early to say, but we may be seeing the first stages of a cascading crossfault situation in oil. Will we? I don't know. I'm just saying there is enough out there to indicate that as a future possibility. The real key won't come until after the end of the month, especially true out in the oil fields themselves. You're not going to hear about these problems anytime soon. People keep asking me when we'll know. I really don't know. Things are pretty quiet and we've only got a half dozen refineries actually being publicly admitted to having problems...but there are many more also with problems. Are all? No, I doubt it. I know of at least 10 that are not reportedly experiencing any problems yet and probably won't because of those 10 they had very few embedded systems in the first place. Chevron, Exxon-Mobile, BP Amoco, Texaco, Shell, these are the folks with a lot of embeddeds to be worried about. Y2K - I never stated it would be a 10. I argued against TEOTWAWKI all along. I knew better. I did argue for the stronger likelihood of a "7" if we had a system collapse of infrastructure at rollover... otherwise I pegged it at a "5" as worst case. It may not be that bad...but one thing is for certain, It ain't over. It's just getting started. We'll see how it plays out. When I know that nothing happened to embedded systems after Feb 1...and it may take a couple of weeks or more to know that...then if there's nothing then we can look at calling the game early, perhaps. But right now, there's problems and developing trends to suggest its just beginning. Frankly, it is still too early for those of us truely in the middle who understand the time parameters involved, it is still too early to write off the embeddeds systems. They are out there, they are actively going haywire and they are creating problems to life and limb both in the oil refineries and natural gas pipelines as well as in mfg like those 2 food plants that blew up last week. In case you have not noticed it, the oil market is not collapsing like it was supposed to after "nothing happened" at Y2K. Problem was, things did start happening, quietly inside refineries and out in the fields. Things are going on. I can tell you that there have allready been some close calls in those refineries. Calls that could have shut those refineries down really quick and for extended periods. It is still possible for a "5" to be developing...which could only work to create an energy crisis as great or greater than 1973/74 Arab oil embargo. Already we've seen one oil report published indicating the outlook now for a 4%shortfall in production ( about the same as the famous embargo ) ...Now why would we be anticipating a shortfall when we're supposed to have all this surplus and the OPEC boys are not tightening farther? Technically, even holding status quo at OPEC the glut would have remained but albeit greatly shrunken. Instead it is going to be a deficit??? What gives here??? I'll tell ya what gives, the oil industry is having production problems out the wazoo...and it just popped up after New years... We weren't hearing any of this stuff pre Y2K... but now NOW NOW all of a sudden...its "oh, we've got a few production problems" and "Oh, btw, we may have a 4% production shortfall, but its nothing to get excited over. yada yada yada." ... Now you just tell me that its all a big coincidence - cannot possibly be related to Y2k, embeddeds and cascading cross-defaults because you've now come to realize the truth that Y2K was a big hoax. Keep in mind. I am not saying there is a "5" yet to come for certain. I'm saying it is still not only possible but VERY possible but no matter what.. it is still too early to conclude anything yet particularly with respect to oil. This is often said... "Don't think for a monent that they can't gerry-rig a refinery in days or even hours." Refineries are never "jerry-rigged". Explosions kill people and break things in refineries. You get a cat-cracker exploding, and let me tell ya, you'll be a couple or three years in getting that refinery back up in most cases. I know. I've been there and seen it first hand, more than once. Any serious explosion can occur by one false spark in the wrong place,& that goes for embeddeds too. A serious explosion in the cat or light ends and you're looking at many weeks to months. Hell's bells..., you can have a simple fire take down a refinery for as much as 90 days depending on circumstances. $40 oil is a real possibility and who knows it may go a lot higher if things do indeed start cascading into cross defaults. I'd say $65.00 is not out of the question, nor even $100.00 under those circumstances. Now will it get there? I don't know. But if it does hit a "5" then yes, I'd see high enough prices to bust that bubble real good no matter what the Fed does. Also, expect to see a war too under such a scenario...Possibly involving Saddam again. "

To: BigBull who wrote (58589)	1/17/2000 1:36:00 AM
From: Douglas V. Fant	Respond to of 95453

BigBull, ExxonMobil specializes in deepwater technology- Exxon brought seismic capabilities and Mobil drilling and acclerated development techniques. No secret I guess that most of the great oil fields of the World have been found in alluvial/deltaic depositions. When you think of the sheer volume and length of flow of the Nile River System and how much detritus,plants and foliage have been flushed out into the Nile Delta Region- boy the potential is there. The question is whether the conditions were right for that plant/animal matter to convert into hydrocarbons and were they then subsequently trapped and accumulated..... Now that drilling technologies and 3D seismic have advanced, worth a look.... But the big action in Africa currently is offshore West Coast Africa....