161 episodes. There is also all-mining….
One day before the bills due date in Denver.
Daniel Kruger got a phone call.
from the one who was waiting.
-I’m Jonathan.
“Mr. Denver, what are you doing?”
– Whoa, is the offer you made to me before still valid?
“If it’s a proposal, you’re talking about mergers and acquisitions.
-I’d like to meet you right away…
“Hmm, what should I do? I have an appointment today. I’ll make time tomorrow.”
Daniel leaned against the backrest and raised the corners of his lips involuntarily.
It was an act to burn the opponent’s shit, but it was because I thought it was sensible even if I thought about it myself.
-no. It must be today.
“Why do we need to meet today?”
-Well, that’s because tomorrow we will go bankrupt…
“Oh, I see. I didn’t know that. I’ve been giving up on it since I heard that your company had demolished the tunnel.”
– I’d like to ask you a favor. I will wait until the time is right, so please only meet within today.
“I don’t know why you were so obsessed with it. What’s this about destroying a decent tunnel for nothing?”
– I have nothing to tell you. I think I’ve been blind for a while.
Daniel covered his mouth and shrugged.
Jonathan, who was upright and stubborn, came out in a low-key stance, and it was not so refreshing.
“Hey, come to the branch. I’ll see you in time.”
-Thank you, Mr. Kruger. I will never forget this grace.
As soon as Daniel hung up the phone, he let out a laugh he had been holding back as if he was about to leave the office.
“Pu ha ha ha ha.”
***
“This bastard must be smiling with his mouth ripped open.”
As soon as Jonathan hung up the phone, he started cursing.
Because I was talking on the speakerphone, I could see who was next to me.
A blank space in the conversation that seemed to hold back laughter.
I couldn’t hear it, but it seemed to be drawn as an image in my mind.
“Okay, uncle. We’ll be the last ones to laugh, so don’t worry about it.”
“Yeah, it should be.”
Jonathan walked over to his desk and began to put all the papers in his briefcase.
I looked at it and asked a question that came to mind.
“Mr. Denver, I have a question for you.”
“What?”
“It’s a bit odd to ask such a question, but why is Lao Tinto aiming at Denver?”
“Of course, it’s because our company’s technology is good, isn’t it?”
It’s as obvious as his answer, but it’s also true that it’s not enough to explain.
Waiting for several years after the first offer, and preparing for the stage of the Ilka Gruyer gold mine, does not make sense that Rao Tinto was just trying to acquire a medium-sized company with good technology.
At least there is something to lead the market.
“Isn’t it important to know how good the technology is? What kind of technology is that, the technology that Lao Tinto was trying to acquire while working hard.”
Jonathan picked up a file folder from the pile and brought it to me.
“It’s probably clear that you want this.”
“Horizontal drilling? Are you drilling horizontally instead of vertically?”
“Yeah, it’s not possible vertically to extract the oil and gas trapped in the shale.”
The shale layer is a sedimentary layer of hardened sand and mud, and the oil and natural gas trapped therein are called shale oil and shale gas.
And, unlike most of the oil fields in the Middle East, shale formations are found all over the world.
There are quite a few here in Australia.
According to Jonathan, it was discovered more than 100 years ago, but it had not been touched due to a lack of technology.
“A company called Chesapeake developed a commercialized technology, and that was the hydraulic fracturing method and the horizontal drilling method.”
“But Denver also has the technology of horizontal drilling?”
“I once worked for Chesapeake. I was fortunate enough to be part of the research at the time. And I used that experience to develop my own horizontal drilling method.”
“You’re passing on such an important skill, so why are you making a face that doesn’t seem like a big deal?”
So is Jonathan and so is Jackie.
Both men had no hesitation in passing the horizontal drilling method.
“Horizontal drilling is too expensive.”
Jonathan turned over a few files and continued, showing the production cost.
“No matter how much crude oil is produced, who will buy it if there is no price competitiveness?”
“But why does Rao Tinto want that skill?”
“It’s probably because of the US government.”
“……?”
“I heard from my former co-workers. They said they plan to increase the proportion of shale oil by increasing the number of producers in the United States. To gain the hegemony of oil.”
Oil.
It is the backbone of an industry called black gold.
As a result, countries with the status of oil-producing countries enjoyed tremendous wealth and power.
Middle Eastern countries, including Saudi Arabia.
They were officially doing something like a cartel controlling oil production and prices internationally through the Organization of Petroleum Exporting Countries (OPEC).
International oil prices fluctuate according to their decisions.
In capitalism, having the right to set the price of raw materials, which is the basis of industry, was a huge advantage.
“Oil and gas account for more than 60% of the world’s energy demand. So if you artificially increase the price, it spreads into a global recession. This is especially true in developed countries with high demand.”
“So the US is going to defend it with shale oil and gas. But are there that many reserves?”
“A lot. They say that if the United States starts mining in a blitz, it may even occupy the No. 1 position in oil producing countries.”
That’s a huge amount to exceed that of Saudi Arabia.
“Rao Tinto is also going to join the flow.”
“It has to be so. Now, it is said that the shale layer is the only oil field without owners on the planet.”
In fact, until a few years ago, there was a lot of talk about depletion of oil or lack of energy.
However, developed countries were preparing to dig not only the oil fields of the rock layers, but also the oil fields of the sedimentary layers.
“Then we can do it too, right? Oil mining.”
Jonathan shook his head at my question.
“As I said before, even if there is no price advantage, the production cost of vertical drilling is around 30 dollars per barrel, but horizontal drilling method is close to 100 dollars. . In the case of the United States, we are developing it because it can be used for both domestic and political purposes.”
“Actually, the US has a lot of different cards that can be used, so the price alone won’t determine everything.”
“Besides, it’s not a country that looks at the loss. If it does, the private company, not the US government, will see it. Unlike the Middle East and Russia, which are state-owned, the US completely entrusts it to private companies.”
Leaving it to the market economy means easing regulations and significantly increasing the market.
It is also an expression of not only domestic oil companies but also foreign companies to freely invest.
So it was clear that Rao Tinto was thinking of jumping into the US oil market.
Even if they are a global mining company, they can’t get in the way as long as the US oil companies that dominate the existing market are blocking them.
I heard that American oil companies have taken over the world so much that five of the Seven Sisters, once called international oil capital, have American nationality.
Even though OPEC has been in the back room since the advent of OPEC, their influence is so far that even Rao Tinto can’t touch it.
“Lao Tinto is also adventurous here and there.”
“Companies have to produce results. But the risk is too great, so it won’t look good.”
“Even if the US leads the way, OPEC will not stand still, right?”
“I will.”
“It won’t be easy.”
What if OPEC member countries increase production and push international oil prices down to the bottom?
Shale oil and gas, which are already expensive to mine, will not be able to survive.
The chicken game had to have a strong pocket, but it was a game that could only be supported by the cost.
‘The shale layer… horizontal drilling method…’
The production cost is high, and competitors with vested interests compete.
I didn’t see any advantages, but it stayed with me.
‘For now, let’s remember that it’s related to oil.’
Oil is the king of energy.
From an industrial point of view, it is an all-purpose raw material that is not used anywhere and there is nothing to throw away.
Although the world is changing rapidly with alternative energy, oil will not give up its nickname of black gold until I die.
***
Jonathan and Jackie visited Lao Tinto West together.
Daniel was consistent with a cold attitude toward those two people.
“Why did you change your mind about the sudden sale of Denver?”
Jonathan shook his head in response to the blunt question.
“I had forgotten that it was impossible on my own until Denver was here.”
“Are you talking about the employees?”
“Yes. So, please, make sure that the succession of employment is possible.”
“Of course. Don’t worry, Denver employees will inherit their salaries, positions, and other benefits.”
“Thank you. Then I’ll sign the contract.”
Daniel shook his head.
“You still have important things to do, don’t you?”
“Are there any changes to the conditions you suggested earlier?”
“Of course. That was then and now is now.”
“Say it.”
“The first $500 million I offered was a premium amount, and now I’m offering $400 million.”
“No, you mean a 100 million dollar cut?”
“So, what did you blow up the tunnel for? You don’t know how upset I was when I reported it to headquarters.”
“……”
Jonathan expressed his embarrassment, unable to respond.
Then Jackie came out.
“From the perspective of our boss, of course, we should have done that, but it’s ridiculous to say that it was the reason.”
“What makes that sense? The mine is Lao Tinto’s property. The tunnel was part of it. It was demolished, but it’s common sense to subtract the amount of damage, right?”
“I didn’t destroy it, but it was restored to its original state. The project was unilaterally stopped without receiving the promised payment, but the tunnel is left as it is? If it was Rao Tinto, I wouldn’t pass the environmental burden caused by the unused tunnel to us later. ?”
“Bombing it up is restoration? Haha, that’s ridiculous.”
“Shall we just claim your company. Hohoho.”
Sparks flashed in Daniel and Jackie’s eyes as they looked at each other.
They are acting as if they first met with Jonathan in between, but the price negotiations were real.
“I’m sorry, the $500 million is hard to accept because Denver has already reported it as a one-time refusal.”
“As each branch manager, you look at the head office a lot. Isn’t the field first in the mining industry?”
“It’s not the nun, it’s the in-house system.”
“Then we have to change the system. I just want to come to the West Branch, I’m going straight to the headquarters.”
“……!”
“Boss, please wake up. What kind of sale would you like to negotiate with a person in charge who has no decision-making authority?”
Jackie stood up and Daniel stopped her with a look of bewilderment.
“No, are you really going to do it like this? After today, the final bankruptcy is confirmed.”
“Rao Tinto isn’t the only company that wants to buy Denver.”
She spoke the name of a company as she spilled.
“There is also all-mining…”