To help put the oil and gas industry in perspective, here is a comparison of Michigan's Corn Farmer to Michigan's Energy Farmer.
|
Corn Farmer
|
Energy Farmer
|
| Harvests at the surface of the earth. |
Harvests below the surface of the
earth. |
Accepts the risk of weather
and rot. |
Accepts the risk of dry holes and marginal producing wells. |
Depletes his corn crop at harvest in a few months,
then replants. |
Depletes his oil or gas field reservoirs in a few years. He must replace the depleted reservoir by drilling high risk wells in order to explore for a new reservoirs. |
| Cannot control his corn commodity price which is set at NYMEX or another exchange. |
Cannot control his oil/gas commodity price which is determined by the NYMEX or another exchange. |
|
He cannot control the law of supply and demand.
|
He cannot control the law of
supply and demand.
|
| He cannot control the consumer demand for corn. |
He cannot control consumer demand for oil/gas. |
| He is likely to be among the vast majority of corn farmers who are relatively small in size but together plant and harvest most of the domestic corn production in the USA. |
He is likely to be among the vast majority of independant oil/gas energy producers who are relatively small in size but together drill most of the reservoir discovery wells onshore in the lower 48 states of the USA.
|