Sam -- I suspect that not only are you correct about limited potential of small global fields but perhaps even a tad optimistic in your pessimism. I would also add that the tail production from even the giant+ fields will fail to deliver production comparable to major US fields IMO. I’ve worked with many small operators producing stripper fields. From my perspective it’s very easy to see why the US stripper wells will always out perform (and more importantly, out live) similar foreign production: entrepreneurship. There are a few small exceptions around the globe but the fact is that small US operators survive off these marginal fields. The net revenue doesn’t flow into the corporate accounts as with the NOC's and majors. This revenue pays the mortgage, pays for the grandkids ballet lessons, pays for the deer lease, etc, etc. It’s essentially a sweat equity business for those folks.

Many (if not most) of the foreign fields are operated by NOC’s or major operators. Those operators cannot afford the manpower to operate at such marginal levels. And by manpower (sometime woman power too) I’m talking about mental expense to analyze and maintain such small operations. ExxonMobil and ARAMCO might be a couple of the largest employers of petroleum engineers/geologists in the world. But they would have to expand their staffs at least 10X to handle any stripper production they might own as efficiently as US small operators. I’ve seen these folks analyze problems for weeks or even months which might only require an expenditure of several thousands of dollars. Is XOM going to pay an engineer $140,000 a year to make decisions that might increase their net cash flow by $300 a month? An obvious answer.

I don’t have much expat experience but what I have seen is that the US is very unique not only in the entrepreneurial arena but also in the private ownership of mineral rights. I suspect there are folks at TOD who don’t realize that almost all mineral rights on the planet belong to some gov’t. And can a political system ever effectively manage such marginal operations? Not likely IMHO.

I can’t offer any quantitative guess to how much oil/NG foreign operators will recover in the future from marginal properties compared to US “mom and pop” companies, but I suspect it will be insignificant compared to the growing need.

I think the big problem with small fields is if the total number is increasing or decreasing. My opinion is that the growth of small field development in the 80-90s as the Majors where cut off from the large ME fields played a large role in keeping the total production up. Polytropos mentions 42% of the production base.

However small fields unlike large fields have another factor at play which is the rate at which new small fields are brought online. One can look at UNG shale plays as a perfect example of this a swarm of rapidly declining UNG shale wells where brought into production leading to a large boost in production rate. Howevr to maintain and expand requires a treadmill of new wells. The small field production follows similar behavior as long as new fields are brought online at a high enough rate then production is maintained or increased.

Once the rate of field addition slows then the decline rate goes to the average of the individual existing fields with little contribution from new fields. Given that we know that peak discovery is well in the past. And given that most evidence points to the majority of the worlds oil basins as being well developed we can expect that the contribution from new smaller fields to either have already declined or to start to decline.

Globally this suggests that the decline rate for the world would be greater than the decline rate for individual basins as the effect of having all the worlds basins fully developed kicks in and additions slow esp for the small field case where new additions play a big role in the actual average decline rate.

And just as important given the long time spans for these sorts of analysis is changing technology. Most of the technical changes have been towards better ability to find oil and reach a higher maximum extraction rate sooner at the expense of a steeper final decline rate.

Better exploration technology tends to ensure that once you can no longer find oil worth producing you probably have done a good job of finding the oil in a region the search is done.

Better extraction technology would tend to ensure once new fields are no longer added the final decline rate will steepen.

And last but not least the same extraction technologies have been applied in reworks of existing fields of all sizes especially ever more advanced horizontal drilling.

Given that world production is at least on a plateau one can readily argue that expansion in the rate of addition of small fields is probably no longer possible or at least can no longer overcome the worlds decline rate. Given the nature of small field development one would expect this to actually be the stronger constraint that new field addition not only has slowed but slowed rapidly. Given the technical advances argument one can then argue that the rate of decline from the 42% of production will increase rapidly. Lets assume it goes from 11% to say 14-15% as the limits of growth are reached in addition of new small fields.

Using the 69.8 production number rounded to 70 ( is this low ?) you get about 30mbd from small fields.
A additional decline rate of 4% would be 1.2mbd on top of a base decline of 3.3 mbd for a total of 4.4mbd. Interestingly enough this sort of decline can account for a lot of the 4mbd of new production estimated to be needed to maintain the overall production rate.

Next we have no reason to not believe that the advances in technology won't cause sharp increases in the decline rates of even large fields once they pass peak production. Canterell is the poster child.
I'd say at least a 2% increase in decline rates for larger older fields is quite reasonable from the technical effect. So for the large fields 70mbd * 0.58 = 40mbd 40*.02 = 0.8mbd of potentially faster decline rates.

And last but not least the smaller fields suffer from much higher depletion rates than the larger fields.
Depletion rates of 10-20% are not uncommon this means the overall field life is generally in the range of
5-10 years before the field is abandoned. If you agree that new field addition has slowed rapidly and that small field production is effectively a square wave from advanced extraction methods then basically withing 5 years of peak your not really talking about a decline rate but production falling off a cliff as the existing small fields go into steep decline without replacement.

This depletion rate approach suggests a 50% decline in production from small fields about five years after new field addition drops rapidly. So if I'm correct that new field additions from small fields actually slowed rapidly in conjunction with the 2005 peak ignoring the questionable and unsustained increase in 2008 then five years later production would be cut in half. All things considered the year before it would probably fall 25%.

This approach suggests that from depletion effects we would see and additional decline rate in 2009 of 25% from the depletion rate of small fields without replacement or assuming production is 30mbd a absolute decline of 7.5 mbd. This dropout effect is in addition to the accelerated decline rate of existing fields for a total decline rate of 7.5+4.2 = 11.7 mbd
Next back to the large fields assume a 5% decline rate plus my technology factor
40*.05 = 2 + 0.8 mpd = 2.8 mbpd.

This gives a total decline in 2009 of 14.5 mbd. Now assuming new projects captured in the megaprojects lists are still able to add the normal average of 4mbd we get 14.5 mbd - 4 = 10.5 mbd of decline.

For export land this is offset by growing consumption in the producing countries lets say its 1mbd increase in consumption. This bumps it up to 11.5 mbd.
Now the export land model also implies that any loss in production will primarily go to exports not internal consumption i.e declining production does not change internal demand.

Overall this approach suggest the contribution of small fields will drop rapidly effectively resulting in the loss of Saudi Arabia and then some from available world export.

It is extreme and certainly its probably a overstatement time variation will serve to spread this out into a more gentle curve. However unless I've made and obvious mistake even cutting the amount by more than half to 5mbd you still get a sharp drop in total world exports. In the case of countries that are net importers and also produce from a large number of small fields this is seen as a effective demand increase in imports.

This scenario also works in reverse before you hit the limit and can no longer bring small fields online.
It suggests that until that limit is reached as long as small fields are profitable swarms can be brought online for several decades leading to a steady growth in production dropouts prevent it from growing to rapidly. I'd suggest that geometric doubling is effectively possible thus even with the high depletion rates you get overall growth for at least two decades. Assuming that vigorous small field development started with the nationalization of oil assets in the late 70's-80's you can readily see you get 20 years of growth out of expanded small field development before it begins to reach the point that dropouts start making it impossible to increase the rate or you reach the limits of growth or probably both about the same time.
1980+20 = 2000.

Bottom line even if I'm wrong in some of my numbers the contribution from small fields to future production should be negative and can be distinctly negative. Just the fairly solid knowledge of the average lifetimes of these fields and knowledge about the discovery curve is sufficient to question any further substantial contribution from small fields. They are not going to help and indeed they probably will result in a very steep decline rate within five years of peak with the decline rate stabilizing when large fields make up about 70% or more of remaining production about 5-10 years further out.

Basically you should see peak production lets put this in the more realistic 2005 peak which showed sustained declines afterwards despite increasing oil prices while the 2008 peak happened as prices increased dramatically then fell off sharply giving no indication it was sustainable.

You have 2005->2008 with a steady decline rate. 2008-2015 with the decline rate basically increasing at 50% per annum from a base of about 5-8% with 2015 production down about 30-50% but decline rate then slows to say 5-8% per annum steadily slowing from then on as it becomes capped by production rates from watered out fields.
Also as it becomes obvious that the world has peaked as long as oil prices remain elevated extreme methods will be used to produce more oil this will work to again arrest the decline rate to some extent.
But this is against a base production with the contribution of small fields well in the past.

I just don't feel that I've made enough mistakes to not conclude that we will see accelerated declines starting last year.

Looking at the US, Norway and UK, they seem to have had little impact on peak production

This is why, IMO, that we can compare these various regions using the HL method. We are, in effect, basically plotting the rise and fall of the large oil fields. The smaller fields that we find post-peak and enhanced recovery efforts help, but smaller fields + incremental increases in recovery factors can't restore production back to peak levels.

I wonder if we might have offsetting penalties with world production, to-wit, we won't see the same drilling density worldwide that we see in the US, but worldwide we do have a larger contribution from unconventional.

Taking these two factors together, perhaps the net result will be a low single digit decline rate worldwide, much like the Lower 48, where in round numbers we saw about a -1%/year decline rate for three years, a -4%/year decline rate for the next six years, and then a long term decline rate of about -2%/year. Of course, keep in mind that a -4%/year decline rate for six years would drop production by about 20%.