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Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsCrumbling Roads in Oil Fields Slowing U.S. Energy Boom
http://www.bloomberg.com/news/2014-07-10/crumbling-roads-in-oil-fields-slowing-u-s-energy-boom.htmlThe road to U.S. energy security is often unpaved.
In southern Texas and North Dakota, where shale drilling has propelled U.S. oil production to the highest level in 28 years, thousands of 18-wheel trucks are rumbling to wells on roads designed decades ago for farmers to bring crops to markets. Road closures have slowed output, with diverted traffic increasing accidents, as Texas seeks $1 billion to maintain roads in the oil belt.
With the U.S. projected to be energy self-sufficient by 2030, according to BP Plc (BP/), crumbling highways may threaten billions of dollars of investment in the oil patch. Because more wells are being drilled using hydraulic fracturing, theres greater need for truckloads of water, sand and chemicals, as well as steel structures used in the process in fields often miles from major roads.
If you drive a cattle truck one or two times a year, youre not affecting that road very much, but the first day you drive a 175,000-pound substructure of a drilling rig up that road you begin to destroy it, Daryl Fowler, the county judge in DeWitt, Texas, said by phone May 20. Youre looking at $2 billion of capital investment in our county alone that will be thwarted or curtailed completely if the road system is abandoned and they cant get their product to market.
pipoman
(16,038 posts)They gradually raise prices over a decade making it reasonable to buy equipment and build infrastructure. Once that is done, they lower the price below the cost of production in the US causing the industry in the US to slow and cease production. Some of the equipment is stockpiled, some is sold for scrap. Then they start raising prices again. ..
Spider Jerusalem
(21,786 posts)the price of oil is largely set by supply and demand; US domestic oil output, until the recent shale and fracking boom, had been in terminal decline, offset only by deepwater wells in the Gulf of Mexico and Alaska North Slope production. The break-even point on Canadian tar sands oil is $80 a barrel and Canada is currently one of the major sources of US oil imports; if the sinister machinations of OPEC were indeed controlling world prices in a manner aimed at eliminating potential rivals, why haven't they done that with Canada?