Quote:
Originally Posted by forebubba
There are more than 9000 open permits in the USA approved to drill oil but oil companies are not using them, why ?
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Because just owning a lease does not mean they can start producing today.
How many open leases were there last year?
Is there infrastructure in the area of these open leases or are they in the buttcrack of nowhere and the reservoir hasn't even been logged yet?
Each lease also has a use-it-or-lose-it clause. There is essentially earnest money that has to be fronted to cover all the government red tape and environmental impact studies.
Not only that, what type of oil is it? More heavy, high sulpher, high salt water content reservoirs don't really push the needle either.
The 9000 open leases is a talking point that doesn't reflect anything. The chances are those leases are not profitable or least not profitable without hundreds of millions in infrastructure buildout.