Hyping Jack No. 2 - The Couricization Of Petroleum Geology

[hatrack]

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The news of this great “discovery” naturally was replayed by nearly every newspaper and TV network in the country. Katie Couric ran a segment about the discovery on her first evening news show. Most reporting emphasized the possibility that the US might have found another 15 billion barrels of oil in its own backyard, but tempered the jubilation with the news that the find would have no immediate impact on gasoline prices. A few, mostly financial journalists, took the announcement as an opportunity to disparage the idea of imminent peak oil. These writers are aware that should world oil production go into decline within the next decade the world’s economy would be in a lot of trouble, not to mention the credibility of those who make a living by forecasting decades of growth ahead. Therefore, they eagerly accepted the dubious premise that this one test proves that plenty of oil can be found by drilling deeper so long as oil prices remain high enough to support the costs of ultra-deep oil production; advanced technology is used to the fullest; and environmental restrictions are lifted. Several pronounced peak oil a dead issue.

As the week wore on however, knowledgeable geologists and petroleum engineers began to question all the euphoria. First they noted that the Jack No. 2 test was not conducted on a single oil field that might contain 15 billion barrels oil. Rather, it was one test of a well in a zone that extends for hundreds of miles under the Gulf of Mexico. Whatever producible oil the zone contains will likely be found in numerous smaller deposits. A number of wells have already been sunk in the Lower Tertiary. Some were dry holes and a few struck oil bearing rock, which may have the potential to produce oil profitably. So far, only a handful of these exploratory wells have struck deposits of light oil, which may be possible to produce. Others have struck thicker oils that may be impossible to extract from extreme depths at acceptable rates.

What seems to be turning up in the deeper waters of the Gulf are a series of smaller oil fields — some of which may someday be profitable to produce and some of which probably won’t. Extrapolating this situation to a major new discovery that will delay the onset of peak oil is clearly a reach.

To extract oil from 20,000 feet below the surface, where the pressures run to 20,000 pounds per square inch (psi) and the temperature of the oil is in the order of 200 degrees centigrade, is going to be a major technical challenge. Wells drilled to these depths will cost in the range of $100 million each. To drill and set in place the production equipment for one of these fields may cost on the order of $1.5 billion, or more, as the cost of oil production equipment is inflating rapidly. Add to this the problem of what to do with very hot oil and the associated natural gas as it comes flowing to the top of a well 7,000 feet under the Gulf and 175 miles from shore. The decision to attempt production from these ultra-deep fields will not be taken lightly by the oil companies involved.


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http://www.energybulletin.net/20469.html

[EVDebs]

1. Truth be told, the oil co's (and Saudi Arabia) KNOW they've got till 2031

They've read Lester Brown's book Plan B 2.0 and the chapter on China/India:

""The inevitable conclusion to be drawn from these projections is that there are not enough resources for China to reach U.S. consumption levels. The western economic model—the fossil-fuel-based, automobile-centered, throwaway economy—will not work for China’s 1.45 billion in 2031. If it does not work for China, it will not work for India either, which by 2031 is projected to have even more people than China. Nor will it work for the other 3 billion people in developing countries who are also dreaming the “American dream.” And in an increasingly integrated world economy, where countries everywhere are competing for the same resources—the same oil, grain, and iron ore—the existing economic model will not work for industrial countries either. ""

http://www.earth-policy.org/Books/PB2/PB2ch1_ss3.htm

[phantom power]

2. gee, that sounds quite a lot like the definition of "peak oil..."

new deposits are harder and harder to get at, more and more expensive to extract, less and less return on investment...