Did anyone listen to Bob Brinker's radio show this weekend on which he interviewed Charles Maxwell? Maxwell is a well regarded oil analyst on Wall Street.
They spoke of oil fields turning around or rolling over, as in meeting their 50% point. At this point, the actual rate of delivery of oil from the field starts to decline. This was predicted by a guy named Dunlap, or something like that.
Anyay, Maxwell said North America rolled over in the 1970's, which has been mentioned on this board. Russia rolled over in the 1980's, and recently, the North Sea rolled over. He sees the Arab gulf peaking and rolling over around 2010.
When asked what he thought companies like Exxon would do, he said that their addition to reserves is now done. (True?) He said that they will continue to make money by raising prices on the increasingly precious crude.
So, my question to the board is, how does Dow fit into this picture? It seems that level and predictable feedstock costs will be over in around 4-6 years.
Sounds right. Also, natural gas feedstock is in the mix. What is grabbing me is how short the time is to get new technology into the mix.
Most invented to implemented changes take 10-years. Remember that Bud Rubens study at Dow back in the 1980's? The mean time from lab book to Major Planning Unit status at Dow for the previous 50-years was 10.4 years. (Major Planning Unit turned on, according to Rubens when the $15 millionth dollar left the loading dock, in dollars of his day.) Rubens invented Styrofoam for Dow and was a Dow Fellow, or something like that.
Also, company size has nothing to do with the time involved, either. Continuing small chemical technology companies have about 10-years between meaningful revenue generating new products.
Anyway, time is the word. Time is getting short. And, in the title words of that fabulous high-tempo Latin jazz song by Elliana Elias, "The Time is Now." Ten years from now is 2015.
Just as an added thought, Midland, for all its isolation, etc., does have one thing most other places don't have. There is the beginnings of a nuclear power plant there. No doubt that nuclear is going to be in the mix one day.