Thursday, June 4, 2009

Death of the US Oil and Gas Industry II

As I said earlier, the industry will be killed by a bunch of legislative verbiage that never reaches the public's attention. Here's another example.

They want to regulate fracturing of wells. Wells are fractured in order to open passages for the flow of oil. It is done by pumping fluid, usually a clear drilling fluid with acid, into the well until the rock fractures. It is a highly technical process and is best regulated by those who are familiar with the local geology - not congresscritters in DC. Most of these wells are drilled far below the level that water wells are drilled to and these strata are protected behind casing.

The increased cost of compliance will force companies to abandon wells early or call some wells as non-commercial that could be producing.

Folks, unless you read the Federal Register every day, you will have no idea what is happening until it is too late.

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