Not Everyone Sold on US Shale Boom
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  • BrianFrankie

    This is an immensley complex subject, one that cannot be addressed in the cmments section. However, Via Meadia also needs to be aware that there are different decline models. The exponential models used by Mr. Hall are actually not very good at predicting shale well declines, which follow harmonic decline rates. Some background on different decline models can be found here:

    http://infohost.nmt.edu/~petro/faculty/Kelly/Deline.pdf

    The upshot is that shale wells decline precipitously at first, but have a much longer tail, producing at low rates considerably longer than conventional wells. Most of the Barnett shale wells are still producing at econmic rates two+ decades after drilling. This will indeed have massive impacts on the economics of hydrocarbon production, but the impacts will be much more along the lines of building a constant rate of baseline production, with new wells drilled only for increasing demand. Mr. Hall has his economics wrong on this question.

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