National Security

Frack-Log…ACTIVATED!

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In my two previous blog posts here and here I talked of a new extended flow oil fracking technique coming on-line that resulted in a lot of drilled uncompleted wells (DUC) and the population of such wells (~5,000). In the comment section of one of those columns I speculated that we have a top end on oil prices where “turn on a dime fracking” will cut in at a price point of $50 a barrel

We now have a “flaming datum” for that speculation, oil having just bumped -HARD- into the $50 a barrel roof for world oil prices. The 5,000 DUC Frack-log is being activated with — I strongly suspect — the new extended play oil fracking technique.

It is being reported in various places that the US rig count jumped from NINE RIGS in mid-May to 325 last week and there was no change from 325 rigs this week. That is a 36 fold increase in rig count in a week!!

Based on figures I’ve gotten from those in the industry, the range of production you can expect from those wells, depending on the geology, length of the laterals (6,000 to 8,000 feet) and the number of fracking stages (200′, 300′ or 400′) will result in initial barrel per day production of between 400 and 800 barrels a day per fracked well (with a very, very rare 1,300 barrel a day play from time to time). So we are looking at between 130,000 to 260,000 barrels a day of American oil fracking production arriving in the next few months.

Compared to Saudi production, 130,000 to 260,000 barrels of oil a day represents between 1.3% and 2.5% of the Saudis’ daily oil flow. The number of DUCs activated to provide that production amount to 6.5% of the frack-log. And all that for what amounts to Zero “CAPEX” (capital expenditure), plus the operating expenses of worker wages, the rental price for existing, out of service, oil fracking rigs, and oil tanker trucks to move product to rail heads or oil pipelines.

Now you know why the Saudis didn’t agree with OPEC oil production cutbacks this week. The Saudis maxing out their oil production is no longer about stopping American oil frackers. The Saudis’ long term regime survival strategy amounts to being the “Last Petro-State Standing.”

The Saudis — like everyone else inside the Big Oil economic paradigm — simply cannot compete with that sort of rapid to market, low cost & low risk oil. The Saudis’ highest priority now is to keep their customers as long as they can, because if they lose them they may never get them back.

Texas Fracking and the Death of Big Oil

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It isn’t often you see the death of a major worldwide industry. Last week I saw the death of the “Big Oil” economic model. It just died at the hands of Texas oil frackers who have developed a new “disruptive technology” that has made obsolete all the pillars of technology underpinning large, vertically integrated oil companies. More importantly, the same is true of all the petro-states that nationalized Big Oil’s assets in the 1960s to make all the state oil companies around the world today.

I found this out doing my day job last week as a Defense Department quality auditor visiting a mid-sized oil service company diversifying into federal contracts. The meeting was about issues with the contract they won and touched on others they have bid on. As a side bar at lunch the following points about their main business came up:

1. Oil field spending has died. Rig count in the USA is the lowest it has been since 1940.
 
2. One oil rig controller company these folks worked with saw a year over year drop of 72% in its business.
 
3. Another company they supplied had their “Cap-X” budget drop from ~$400 million for 2015-2016 to little over $30 million for 2016-2017.
 
4. One drilling company they supplied went from 120(+) new wells last year to _12_ this year.
 
5. This supplier sold a lot of copper tubing for “frack-log” drilling. That is the drilling of holes in good oil-bearing rock without fracking rock for oil immediately — and here is the new part — to take advantage of a new long-flow fracking technique.

While most of the points above are due to the Saudis’ oil price war on Texas frackers. An ex-Big Oil geologist I know put it this way —

The entire reason for the price drop was because the Saudis wanted to destroy fracking in the United States in order to keep us dependent upon them in order to keep them getting a free defense. The Saudis will have to diversify and start spending money on defense before the price goes back up, or they will be in serious trouble.

The technique in Point #5 above marks another “fracking revolution” that is of growing importance to the USA. This new fracking energy revolution will upend the world order as we know it. Political winds willing, America may well be a net hydrocarbon exporter in five to eight years.

Explaining why that is requires some background in Texas oil fracking.

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Obama and US Cultural Confidence

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Richard Fernandez:

President Obama got it exactly wrong when he argued in a Washington Post op-ed that “as the only nation ever to use nuclear weapons, the United States has a moral obligation to continue to lead the way in eliminating them.” What he should have written instead was “as the only nation ever to refrain from using nuclear weapons gratuitously when it had the monopoly on such weapons, the United States has the moral authority to lead the way in regulating them.”
 
What gives the US moral authority is bias, the improbability of it using nuclear weapons in time of peace. You can be sure the USAF won’t nuke Chicago, or Brussels or Kampala tomorrow, even if it physically could, because of civilizational bias. The reason why Obama’s unilateral reductions in the American nuclear arsenal as gestures to nuclear disarmament are meaningless is because he’s not actually reducing any of the risk. All the danger is on the other side, where the bias goes the other way for aggression, conquest and world domination. That is what he seems unable to reduce.
 
[. . .]
 
The reason why statements like “Islam is the religion of peace” or “we will never be at war with Islam” are so dangerous is because they ignore bias and reduce the problem to the mere monitoring of things. They put the most important factor of all into the error term. The result is a world of runaway entropy that is more dangerous to everybody, especially to Muslims.
 
[. . .]
 
These Kurdish peasants instinctively remember what the West has forgotten, that man lives not just in a world of things but of angels and demons. Cultures and belief are not optional extras but the bedrock of survival. They know instinctively that for man to survive he must fight Evil which is real with the aid of the Old Ones, who are also real. Only thus can he change his biases; only thus can he get the better of entropy.

President Obama is the anti-confident American. He seems to believe that his country should be taken down a notch or two, should apologize for past wrongs, should stop seeing itself in terms of confident exceptionalism. How’s that working out? Fernandez’s points aren’t new but bear repeating. Belief in cultural and moral equivalence is effectively suicidal. Our elites are too corrupt and incompetent to understand that this is the case or to know what to do about it.

Revisiting “Belgium — The Failed State in the Heart of Europe”

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Jim Hoft over at Gateway Pundit has a guest post by Drieu Godefridi that is essentially a follow up to my March 24th, 2016 “Belgium — The Failed State in the Heart of Europe” piece.

It is unsurprisingly titled “Guest Post: More Terrorist Attacks Likely in Failed State of Belgium.”

Please go give Jim Hoft’s site some “linkie love” while checking out the full post, but before you go, this portion of that post bears immediate and close reading —

It is thus obvious that the Belgian government is in a shambolic state at every level, from the local to the federal, and from the executive branch to the judiciary.
 
Of course none of this would have been possible without the policy, in place now for 30 years, to open Belgian citizenship — and the borders — to hundreds of thousands of people from around the world. This open invitation has been extended mainly to Muslim countries, instigating the creation, ex nihilo, of huge Muslim communities in the cities of Brussels, Antwerp and every other Belgian city. Radicalized or not, fundamentalist of not, peaceful or not, these communities tend, in Belgium as anywhere else, to impose their political-religious credo.
 
A study by the WZB Social Science Center (Berlin), published last year in the “Journal of Ethnic and Migration Studies”, indicates that half the Muslims in Belgium, France and Austria are fundamentalists, i.e. they think that Muslims should return to the roots of their faith; that there is only one interpretation of the Koran; and that Muslim law should supercede civil (or common) law, (“Religious Fundamentalism and Hostility against Out-groups. A Comparison of Muslims and Christians in Western Europe”, Journal of Ethnic and Migration Studies, Vol. 41, N °1, 33-57). This Weltanschauung (or concept of the world) is irreconcilable with the rudiments of our Western civilization, or for that matter any society which is not strictly Islamic. To assert that Islam—which is much more than simply a religion—has nothing to do with the current spate of terrorist attacks in Europe is a psychotic denial of reality.

Denial of reality is at the heart of the “European Union” project, which has Brussels as its capital.

That is why the “Belgium — The Failed State at the Heart of Europe” meme is spreading. It is obvious to all this will not end well…but end it will.

And its passing will be marked with fire and blood.

Belgium — The Failed State in the Heart of Europe

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Today in Europe, in the aftermath of the Brussels terrorist attacks, a dark truth stands reveled about the nature of the Belgian state. Belgium is a failed state at the heart of Europe…and much of the rest of Europe is following.

Belgium quite literally lacks the military means to enforce the sovereignty of the Belgian state in the Muslim neighborhood of Molenbeek in Brussels, the Belgian Capitol.

The following is via John R. Schindler of The UK Observer:

Europe Is Again at War

We should expect more guerrilla-like attacks like Brussels yesterday: moderate in scale, relatively easy to plan and execute against soft targets, and utterly terrifying to the public. At some point, angry Europeans, fed up with their supine politi1cal class, will begin to strike back, and that’s when the really terrifying scenarios come into play. European security services worry deeply about the next Anders Breivik targeting not fellow Europeans, but Muslim migrants. “We’re just one Baruch Goldstein away from all-out war,” explained a senior EU terrorism official, citing the American-born Israeli terrorist, fed up with Palestinian violence, who walked into a Hebron mosque in 1994, guns blazing, and murdered 29 innocent Muslims.

When that violence comes, a practically disarmed Europe will be all but powerless to stop it. To take the case of Belgium, at the Cold War’s end a generation ago, its army had seven brigades with 18 infantry battalions, plus some 30 more battalions in the reserve. Today, Belgium’s army has only two brigades and six infantry battalions, some 3,000 bayonets in all. That tiny force would have trouble exerting control over even one bumptious Brussels neighborhood in the event of serious crisis.

Thanks to Belgium’s sovereignty collapse, Europe is now in the throws of an emerging decade plus Muslim insurgency spreading from Brussels…

…while E.U. Security Forces supporting the Belgians are more concerned with repressing local predominantly white citizens from striking back at terrorist inclined Muslim migrants than dealing with the Muslim problem to begin with.

And it gets worse, with hundreds if not thousands of trained terrorists arriving with the multi-million person Muslim Migrant wave that German Prime Minister Frau Merkel kicked off in 2015. The EU faces a situation where it will see a ‘major’ (Charles Hebdo, Paris, Brussels class) EU terrorist incident every 60 to 180 days for the foreseeable future. This leaves aside the worse than American urban ghetto crime and sexual assault rates these illegal Muslim migrants are now inflicting on EU citizens.

NB: The EU is now no longer tourist friendly, with all the economic fall out that means.

The political corruption — and ethnic tensions between the Dutch speaking Flems and French speaking Walloons — that dominates the Belgian state make it impossible to remedy the Muslim insurgency there.

Nothing short of Belgian territorial partition between France and Germany can bring effective enough military governance to end the Muslim Insurgency in Brussels.

Given that awful reality, Donald Trump’s idea of reducing America’s role in NATO (Or perhaps even getting out of NATO all together?) is the best thing the USA can do.

Both Vietnam’s and Shia Iraq’s lessons for America’s citizens are that it is a futile waste of American lives and treasure to try and protect people who don’t have either the will nor the means to protect themselves.