39 comments on Kern River Production Estimates versus What is Economic
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39 comments on Kern River Production Estimates versus What is Economic
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GAIA Host Collective
Rock-
I have found quite a bit of oil in the past 10 years. From 660-3500' deep. But my best wells are 660' deep. They average about 6 BOPD after 8 years but have no decline. They never made more than 15-20 apiece. They will never be sold as long as I'm cogent.
I had a 220' well that made 8 BOPD for years. That was my favorite well.
FF
While your comments are to Rockman, I got to thinking: If the decline rate of Kern River is 6% per year with lots of infill drilling, the decline rate of individual wells is likely even higher than 6% a year without infill drilling--say 7% or 8%. Kern River likely doesn't have many wells with long life-spans. The wells only drain fairly small areas, and run out quite quickly.
Gail,
That makes sense but I bet you it's because Chevron shuts down steam injection in units when producion rate drops below economic limit WHEN the cost of steam injection is included. But I bet you a nickle those well can still make a bbl a day or so by gravity drainage but the labor and maintenance efforts aren't worth it to Chevron. But I bet if you owned 10 of those wells and were netting 7.5 bopd (10 bopd less 25% royalty) = $9,000/month ($40/bbl) less ops costs (guessing around 20% = $1800/mth) you be making around $86,000/YR. Chevron can't cover salaries, benefits and over head on that type of cash flow. But a high school drop out whose worked in the oil fields for 15 or so years could run this op in his sleep. And that would be $86,000/yr going into his checking account.
That's why I'd bet this field and hundreds more will still be producing in the next century. So one could legitimately predict huge volumes of oil for ultimate recovery. Those numbers would be impessive as long as you don't point out the many deades it would take to reach those levels. The combined daily production will be completely insignificant as far as US demand goes but they will still be producing. In the example I gave above the couple were still making a nice income off of those wells with little or no deline and the reservor had only recovered about 12% of its in-place after 50 years of production. That's why I believe the last oil company funtioning in the US won't be Exxon or Chevron. It will be Joe's Oil Company and Bait Shop.
Without steam, with existing equipment, the amount of oil being produced by gravity drainage alone will drop from 10 bopd to something like 2 bopd. If owners switched to progressive cavity pumps, they could get more, but it is not clear to me that it would be anything like the 10 bopd. Individual owners would also have a hard time keeping up the cogeneration facility. It is not clear that their electrical supply would continue for this reason. Without electrical supply, how much of the operation could continue? The progressive cavity pumps might take oil out, but what would happen to the 90% wastewater that needs to be treated or reinjected?
Gail,
Even 2 bopd by grav drainage might be optimistic. But that's why the little guy can prosper in such an environment. With chatter about billion bbl oil fields and 88 million bopd figures I know it's hard to get our minds around someone making a good living off of 10 bopd. Again, none of this has any bearing on civilization’s future but I'm still tickled by those efforts.
Just one more little aside: even when only gravity drainage is all that's left you don't need all those pump jacks and oil tanks let alone steam plants. Long ago a farmer took over a group of shallow oil wells on his property. The previous oil operator had abandoned those wells after stripping the field of every pump jack, oil tank and even scrap metal lying on the ground. The land owner built a pulley on his tractor and ran a “swab line” off the power take-off of the tractor. A swab line is essential just a length of wire cable. He would roll up to a well and repeated pull the swap line in and out of the open casing head. With each pull came a little oil which he pumped into a small wheeled oil tank he pulled behind the tractor. I forget the numbers but he made a much better living off his oil production then farming. And the story doesn’t end there: as word spread and folks began duplicating his efforts a company in OK started producing tractors already set up for similar operations.
I wasn’t kidding: I’m sure after all the big oil companies are gone there will be thousands of one or two man operations still producing oil. Granted that amount wouldn’t fuel one small American city let alone the globe. But that wasn’t the initial point. Kern River will be producing commercial oil 100 years from today. And in time may well produce all the oil some predict. Not exactly a “Mad Max beyond Thunderdome” world. But you can tell how I admire the nature of a man to profit when a corporation cannot.
I don't think either of you two are catching my drift (see below).
Chevron has burned trillions, if not quadrillions of Btu of (our) natural gas to produce oil they have sold for a (handsome) profit. Over time, they've paid only a fraction of a dollar (per million Btu) for this. All the CO2 in that natural gas (or crude, when they burned that) is now contributing to the climate problem.
A sizable fraction of those Btu's still remain underground in the Kern River Field, suitable for recovery by existing pumping methods through the porous formations. The recovery of the electricity (including development costs) could be done within the investment budget that Chevron already has.
At some point they will want to "shut down" the oil production and abandon everything because it isn't "profitable" to produce the oil any more, and they expect us to approve of this???
Excuse me, but I don't think so!! If the Energy Commissioners of California are worth their salt, they should not allow it to happen. They have renewable energy goals that must be met. The Kern River "thermal" field (along with other San Joaquin fields) could make a significant contribution toward meeting those goals at minimal additional investment. It certainly would be far less costly than the electricity from CSP plants SoCal Edison has committed itself to buy.
"First they ignore you, then they laugh at you, then they fight you, then, You Win" M. Gandhi
Sorry Guy. I caught your drift but was distracted. I'm sure in some fields thermal recovery efforts could be attempted. But I doubt KR would qualify. Most of what I know I've gained from Gail's posts but I suspect it would be difficult to effectively move the water thru those heated sections. Secondly, unless Chevron leases allow thermal recovery those buried BTU's belong to the mineral owner. And lastly, it's not likely any regulatory body could compel Chevron to take on the task. But if the state of CA would want to take on the task and spend their money I sure Chevron would be glad to donate those leases to the state.
Didn't Gail say that 80,000 bpd of crude was produced with 90% water cut? That would produce about 720,000 Bbl/d (30,000 Bbl/hr)of water at a 230 F in-hole temperature. Let's say the water arrives at 194 F (90 C) on the surface gathering tank after heat losses in the gathering process.
At 350 lb per barrel they're handling 10.5 x10^6 lb/hr. If this is cooled from 90 C to 50 C (122 F) for treatment, this is equivalent to 10.5 x 10^6 x 72 F = 756 x 10^6 Btu/hr. At a "heat rate" of 15,000 Btu/hr/kw (not counting the harvesting of CAPE in the atmosphere) , were looking at a potential of generating 50 x 10^3 kw = 50 MW TODAY, from material that is already being gathered and which constitutes a minor fraction of the overall field.
During the summer, this output could be nearly doubled during "high demand" peaks, from the heat contained in the troposphere.
To me, it doesn't matter what Chevron can be legally compelled to do. They are broadcasting commercials on television trying to convince everyone how "green" they are with they're "willyoujoinus" campaign, even saying it was important to use "less" energy.
The question then becomes: "Will they put their money where their mouth is?" If so, even I might consider joining up.