Why are oil companies not drilling the 41 billion barrels of offshore oil they can legally drill?

there is 41 billion barrels of oil under the continental shelf that oil companies can drill for today if they want. Yet there are only a couple of rigs doing so. Yet they want access to the 19 billion barrels of oil off the east coast instead, because its cheaper and easier to drill. Will the conservatives ever pull their heads out of their @ss? They should be outraged that oil companies are not drilling the oil they have, instead of trying to help them make more money by passing laws to let them have the easier oil.





www.USGS.Gov


Keyword continental shelf oilWhy are oil companies not drilling the 41 billion barrels of offshore oil they can legally drill?
Just because oil exists on those leases does not mean that it is economically recoverable. Unfortunately, you cannot tell before acquiring the lease whether the oil exists, or if it is producible. There are plenty of geologic and financial reasons for not developing these leases. Do the right kind of source rocks exist, was the geologic history right to ';cook'; the rock and turn the dead plankton into oil, did the right types of faults and traps exist for the oil to accumulate, does the oil now sit in high quality reservoir rock that will allow it to produce into the wellbore at sufficient rates, and is the pool of oil large enough to justify construction of a XXX million dollar platform and other necessary infrastructure? Offshore oil development is hugely expensive, and can go into the hundreds of millions or even billions of dollars for deepwater production. The larger the cost, the larger the accumulation must be to make it economic to produce. So, after spending hundreds of million dollars to acquire these leases, to conduct seismic, and to drill some exploratory wells, the geologists, engineers, and geophysicists have evidently decided there is not enough oil there to be worth going after.





THERE IS NO CONSPIRACY by the oil companies to tie up the leases to keep prices high. Why would they want to spend billions of dollars in lease acquision fees to do this -- Congress has already made it off limits, yet in testifying before congress, the CEO's of the big oil companies all urged Congress to open our waters for exploration.





If there were exploration targets on available US acreage that are even half as good as those overseas, you can bet your *** they would be drilled. Why would the oil companies rather drill elsewhere in the world, in hostile climates and in countries which could easily nationalize their oil industries? After spending billions of dollars to find and develop an oilfield, do you really think the oil companies want to have it expropriated? It simply makes no sense. And by the way, it is not about easy oil. It is about geologic, politial, and financial risks, as well as other factors such as lease terms and tax climates. Did you know that in some overseas contracts, the oil companies only make a few pennies on the dollar for every dollar the oil price rises above $25/bbl? The windfall rests with the foreign government, not with the oil company. US lease contracts could be structured similarly, such that there is a good balance between the exploration and cost risk borne by the oil company, with royalties and much of the oil price upside retained by the US government.Why are oil companies not drilling the 41 billion barrels of offshore oil they can legally drill?
Pretty much for the same reason the Sheikh from Saudi told Bush somethign to the effect of ';I could personally send you 1 million extra barrels of oil a day and it wouldn't help. You don't have the capacity to utilize it.';





There is plenty of readily available oil, the problem is with the infrastructure.
why aren't Dems taking it and having the Gov't Drill it with tax dollars?





It's not there economically.





Why don't Dems start an oil company, buy the leases and rill? There isn't enough oil there.





Lower intelligence people often fail to realize that Dems are pretending that those leases have the same amount of oil as the places where oil has already been found.... when in fact, these leases don't.
There are already 3,300 platforms off the coasts of Louisiana and Texas. Why don't we just let the oil companies decide where they want to drill since they are the ones required to spend up to 100 million just in exploring a leased area.
Of course anyone would want to drill the oil that is easier and cheaper to get.
Take an economics class for crying out load.





Oil production IS a business... not an entitlement...
to keep prices high...we need to pass legislation to make them ';use it or lose it';