Maxdeath
Diamond Member
- Jun 12, 2018
- 7,720
- 6,430
You have to love how many keep claiming high profits without realizing exactly what goes into producing oil and fuels.
let’s take a quick look at costs. I will just glance over it. Not going into great detail as that would take many pages.
a geological survey will run anywhere from half a million to over 2 million. If it looks like there could be oil. Then the permitting process begins. That means an environmental study. Search for who owns mineral rights, who owns lands that may need to be crossed. On and on and each wants their compensation.
Drilling costs and moving a drill rig on to a location can be three million on up. If you hit No oil or just a small pocket that is not worth producing then you have the cost of moving the drill rig and abondoning the hole which can run close to a million in some cases.
If you hit a big enough pocket of oil then the real expenses start. Case the hole which requires a lot of metal casing. Move the drill rig off. Bring in a workover rig. They run metal tubing then determine how much oil the well will produce. You can be talking 2 thousand an hour for 12 - 14 hours a day for a week.
Erecting a pumping unit, tanks for holding oil. A unit that separates the water and oil. Then how is the oil shipped a pipeline or trucks both have costs.
The well and the water separator both need constant maintenance and sometimes repair.
Once the oil reaches the refinery you have a large refinery on acres of land that requires constant human activity to run.
Both have investors in those that own stock in the companies each invested wanting a return.
Most companies are getting about 5 or 5.8 % profit. Which is pretty standard for any business. Once you take a business global the amount of profits grows but so do all the countries wanting their share of the money in the form of taxes.
let’s take a quick look at costs. I will just glance over it. Not going into great detail as that would take many pages.
a geological survey will run anywhere from half a million to over 2 million. If it looks like there could be oil. Then the permitting process begins. That means an environmental study. Search for who owns mineral rights, who owns lands that may need to be crossed. On and on and each wants their compensation.
Drilling costs and moving a drill rig on to a location can be three million on up. If you hit No oil or just a small pocket that is not worth producing then you have the cost of moving the drill rig and abondoning the hole which can run close to a million in some cases.
If you hit a big enough pocket of oil then the real expenses start. Case the hole which requires a lot of metal casing. Move the drill rig off. Bring in a workover rig. They run metal tubing then determine how much oil the well will produce. You can be talking 2 thousand an hour for 12 - 14 hours a day for a week.
Erecting a pumping unit, tanks for holding oil. A unit that separates the water and oil. Then how is the oil shipped a pipeline or trucks both have costs.
The well and the water separator both need constant maintenance and sometimes repair.
Once the oil reaches the refinery you have a large refinery on acres of land that requires constant human activity to run.
Both have investors in those that own stock in the companies each invested wanting a return.
Most companies are getting about 5 or 5.8 % profit. Which is pretty standard for any business. Once you take a business global the amount of profits grows but so do all the countries wanting their share of the money in the form of taxes.
