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| Oil BRIEF The United States represents just 5 percent of the world's population yet consumes a quarter of the world's oil supply. U.S. oil production is near a 50 year low, the vast majority of America's 500,000 producing wells are considered "marginal" with output of only a few barrels a day. OPEC's present production level stands at just 1 to 1.5 million barrels per day. That is a drop in the bucket versus current global demand of 82 million barrels per day. Over one half of all of Saudi oil production is from a single field "the Ghawar field" which is in serious decline. Adjusting for inflation, todays near record oil prices are still more than $30 below levels reached in 1981. Many experts believe world oil production will soon peak and then available will decline. Analysts agree that the world's oil reserves will be unable to sustain present production levels of 74 million barrels per day beyond 2022. Projecting a two percent growth rate in oil demand will trigger a world oil production peak of 87 million barrels per day by 2011. Similarly, a 3 percent growth rate will push forward the peak to as early as 2006. GAS BRIEF The U.S. consumes approximately 23 TCFG (Trillion Cubic Feet of natural Gas) per year and is increasing at a rate of over 2 percent annually. The current domestic production is currently at approximately 19 TCF per year resulting in an annual shortfall of about 4TCFG. The U.S. Department of Energy (DOE) projects that 900 out of the next 1000 electric generating power plants built in the U.S. will run on clean burning natural gas. According to the U.S. Census Bureau, 70% of all new homes constructed in the U.S. are designed for natural gas. Imported Liquefied Natural Gas (LNG) is projected to represent just 1% of current consumption in the U.S. The infrastructure required is capital intensive costing several million to over one billion dollars per LNG terminal depending on capacity. Offshore reserves are trapped well outside of current technological and economical risk boundaries. Current demand exceeds dwindling domestic supplies. Global growth stretches world reserves even further. SO WHERE IS ALL OF THIS OIL AND GAS GOING TO COME FROM? Domestic Energy Development Inc. has used the combined industry experience of our officers and associates to accumulate over 200,000 proven and highly probable hydrocarbon productive acres in South Texas. Reserves from our combined acreage is estimated to be 200 BCFG and 1 MMBO assuming that the price of hydrocarbon do not increase the combined reserve value would be 14B$ for gas and 50MM$ for oil. |
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