The Oil Drum

There must be some similar process or behavior at work in order for HL to produce similar outcomes in different oil provinces if that is what it is doing.

Yes, and I'm surprised there has been so little discussion of this so far on this site. On poster on the HL debate left a clue: creaming curves.

It appears from the empirical evidence that the sizes of oil fields in any oil province are distributed so that there are very few large fields and increasing numbers of increasingly smaller fields. Geologists can't demonstrate from physical laws why this must be so, nor can they give you a formula to predict the distribution, but still that's what the creaming curves tell us.

Given this fact, it is easy to see that simple economics will, in part, govern the history of oil production. All other things being equal (and I know they are not), production from a large field should be more profitable than a smaller field because the costs of exploration and development of a field can be amortized over more barrels of oil. That being the case, larger fields will tend to be developed before smaller fields.

Over time, as fields deplete and production declines, that decline must be offset by the development of an ever larger number of smaller fields, which decline more quickly and must be replaced at an increasing rate if production is to be expanded or even just maintained. At some point, the capacity, financial and technical, of the oil industry to add new production will fail to keep up with the required rate of development and production will peak and go into decline.

There is a hypothesis for you all to chew on.