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10 comments on Two short items to note

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Lars on October 3, 2005 - 9:15am Permalink | Subthread | Comments top
Reading the heated discussion on the linearisation of Hubbert Peaks it struck me that there is no common terminology for talking about "depletion". It became apparant that two distinctly different "depletion types" are used, and I think it would be a good idea to use two different words for them:
(my first try, there must be way better terms, but not being native speaker i find it hard to come up with really good terms)

Oilfield Depletion : % of remaining oil in a  field that is pumped out per year
Example : The oilfield Ghawar depletes at 5 mbpd, this is currently X% of the remaining reservers

Production Reduction : % of production that erodes from the peak production per year
Example : Cantarell has peaked in 2004 at 2.2 mbpd and currently has a production reduction of 14%, this means that it will produce 14% less this year than it did last year.

I think that there is a correlation between the two, but not a logical tie.
Ghawar with its unusual porous rock could have a Production Reduction of allmost 0, but a HUGE Oilfield depletion.
A field with very bad source rock could have a very high production reduction, but a very low oilfield reduction rate.

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Typhoon on October 3, 2005 - 10:41am Permalink | Subthread | Parent | Comments top
Yes, there needs to be common terminology. How about "depletion rate" and "decline rate"? "Depletion" has become accepted for both definitions (in my view, incorrectly) but why not use "depletion" for percentage of proven reserves produced, and "decline" for year over year drop in production? There is no reason to be confused and use "depletion" for both. In fact, this makes sense when you look at the dictionary definition of "depletion":
    de·ple·tion
    n.
    The act or process of depleting.
    The state of being depleted; exhaustion.
    The use or consumption of a resource, especially a natural resource, faster than it is replenished.
The definition of "depletion" refers to the verb.
    de·plete
    tr.v. de·plet·ed, de·plet·ing, de·pletes
    To decrease the fullness of; use up or empty out.
The act of pulling oil out of the ground fits this definition, but not a decline in rate of doing so. Therefore, I have always found it odd to hear that a country will be "going into depletion", since depletion happens from day one!
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NC on October 3, 2005 - 11:11am Permalink | Subthread | Parent | Comments top
This is a great distinction, thanks for highlighting.  I tried to get to this point a week or so ago unsuccessfully (probably through poor choice of words).  

I also think that it is not how much oil is still left in the ground, it is the declining rate of new production that is the warning sign.  Even if all the existing wells don't have a drop in production (not true) we couldn't increase production unless more wells are constantly coming online.  Huge decline in new wells = big decline in future growth of oil supply, assuming all existing production stays the same.

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10 comments on Two short items to note

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