A belated response to CGES
Posted by Heading Out on September 6, 2006 - 10:57am
Topic: Supply/Production
Tags: cges, chevron, insurance, Jack 2, mars, thunder horse [list all tags]
Further within the considerable comment that has been provided on a number of stations was the comment that this is the "final frontier" for oil exploration. Actually it probably isn't. There are still some places further North that have not yet been fully explored, but it is getting very close to the limit of where we can afford to economically look. We are, by the geological definition of where oil is likely to be found, starting to run out of places to look for these large fields.
More than a half a dozen world records for test equipment pressure, depth, and duration in deepwater were set during the Jack well test. For example, the perforating guns were fired at world record depths and pressures. Additionally, the test tree and other drill stem test tools set world records, helping Chevron and co-owners conduct the deepest extended drill stem test in deepwater Gulf of Mexico history.
The oil that was found was thus expensive to find, and will also be expensive to produce. It is also far enough out into the Gulf that the platforms that will produce it will run into the same risks that hit Thunder Horse and the Mars platforms, and which, should more hurricanes hit the area, may make it more difficult to find insurance.
"The harsh reality is that there's just not as much insurance available this year as there was last year," said Al Reese, chief financial officer at ATP Oil & Gas, based in Houston. "There are some companies that only got limited coverage or were unable to obtain coverage at all this year. It's very, very scary."The problems of getting insurance for work in the GOMEX were discussed last October, again in March and are unlikely to have eased since then. Remember that over a hundred rigs were lost to hurricanes last year and that more damage in the future is going to make the problem of getting insurance only worse.
Deep water fields (and this I heard today referred to as very deep water) have been expected to provide a blip to world production as it was found, but the number of places to look are limited, depending as success does, on suitable geology. This is now starting to be produced around the world, including those fields listed offshore Brazil, and various countries of Africa.
The advent of Peak Oil does not say that discoveries will stop, nor that the world does not have significant amounts of oil left, both to find and produce. Rather it marks the point where production reaches a maximum, which may be only indirectly related to the remaining size of the reserve base. (From the point of view that it is more directly related to the mechanics of production). And production from very deep water may be slowed for a variety of reasons. And interestingly, since the field will not be more fully defined until more wells have been sunk and appraised, will it be entered into the books as a 3 or a 15 billion barrel field? It has, after all, not been that long since there was a large find reported down Mexico way.
Which brings me back to the discussion on depletion and reserves that I started with. And rather than reiterate again in detail what has been said, let me try and simply explain my comment about "overbounding simplification."
Reserve additions each year come about either from the finding of new fields or by re-assessing the amount of oil that exists/can be recovered from existing fields. Depletion of reserves occurs when the amount added is less than the amount that has been produced. That is the simplicity of the CGES argument. However, by going back to 1954 and comparing overall numbers this hides within that summation any trends in the data that have developed over this time interval.
Further, and I tried to illustrate this by reference to oil fields in KSA, the estimated reserve growth can be achieved not by finding new fields, nor by finding that the field is bigger than before, but from an assumption that more oil can be extracted from the same overall Original Oil In Place. No more oil has been found in this case, it is merely assumed that a greater percentage can be recovered and thus the reserves grow. Well they sometimes can, but as Shell learned at Yibal sometimes they can't, and the reserve estimates are overstated. That was the concern - I expressed it with the note that recovery factors for the KSA fields had been increased, except for the Abqaiq field, the one closest to being fully extracted, where the recovery factor was lowered.
Because CGES just built in changes in reserves without indicating the potentially questionable nature of some of the ways in which reserve values have been added, they glossed over (oversimplified) the situation in a way that left, to my eye, a somewhat rosier picture of the future than seems justified.
With all due respect.
I think it was called Ernesto. I knew it would amount to nothing. Especially since 6 or 7 days out, the graphics posted here showed it making a direct hit on New Orleans.
I'm not going to get into a whole, "just because the apocalypse didn't happen last time, it will this time argument." Or the 50%/100% example that was layed out here yesterday.
I'll just leave it at - I was right.
Insurance is a hedge. Who did the article on Futures yesterday? With excellent points raised by Halfin.
Let's get out of the game of "seeing" the future.
Again, with all due respect. I'll go and read the rest now. Thanks for your constant work.
Oil CEO said
"Let's get out of the game of "seeing" the future."
I say, EXACTLY.
Look, we all know the direction we have to go. Consumption has to come down, peak yesterday or peak in 20 years.
Diversification of energy supply has to go up, peak yesterday or peak in 20 years.
Greenhouse gas is a critical issue to at least stabilize, peak yesterday or peak in 20 years.
Light sweet crude oil and natural gas are natural wonders, peak yesterday or peak in 20 years.
The economic burden of exporting billions, trillions, is bleeding our nation to death, peak yesterday, or peak in 20 years.
The strategic weakness created by our massive dependence on a smaller and smaller part of the world is leaving us vulnerable in a way we have never been, peak yesterday, or peak in 20 years.
The level of waste is an atrocity, peak yesterday, or peak in 20 years.
Our problem is this: Everytime we make a major new find, does the public take the position that "hey, we have a bit of breathing room, it gives us a small bit of extra time to make the changes needed, and reduce fuel consumption first, by say 5%, then 10%, then 20%....the finds are proving that we still have a fair amount of oil left to assist in these changes if we begin to do so now...we can bring down consumption while production holds steady....and then, at whatever point begins to drop, we will have technology already tested, and be able to back down on consumption as we diversify."
Now, do you hear anybody out in the press talking that way? No, what they say is, "oh boy, the price will drop back and we will be able to have a nice SUV for a few more years", or "you know, I would like to take one last fling, I have never owned a speedboat that really gets your blood going, and, helll, I'm getting older, I deserve to live a little....or one of them new Bimmer 500 horsepower sedens, have you seen that, performs like a Porsche but as comfortable as luxury car! And you know the rich aren't conservin' shiit, or they wouldn't be building them...."
If we simply see each new find as an excuse not to change, not to use the reprieve, then timing the future, timing the peak, and finding more oil don't matter, the outcome will be exactly the same.
All that will matter is when the right chamber of the gun in Russian Roulette comes before the barrel....we may get lucky, and make it to the old folks home, and find it unheated and unlit, with no medical machinery, or it may come next winter, with a sudden shock of fuel oil too expensive for any but the most wealthy to afford....who can guess? But, it don't matter, we will all know what needed to be done....but by then, we will have used our reprieves up....the 10% or 20% a few years behind us could have gotten us by, but it by then, whether it is 2007, 2010 or 2030 won't be of any use. We actually knew it a third of century ago, but what happened. The North Sea, Saudi Arabia, offshore oil, Alaska....we found bought and used one more reprieve, and had the biggest party by the biggest young population in history.
The exact date does not matter to the nation, without major change, the outcome remains the same. It does matter to the individual. Can he/she buy one more party, one more reprieve? We count our years...damm posterity, can we find enough in small pots or big ones, to get us to the grave?
This is why we play the " game of "seeing" the future." We count our years against the years to "peak" that will decide whether we can live the good life and avoid change, and die in peace.
A generation that has no purpose except to hang on by it's fingernails, and bleed the world dry just as we die, this our noble version of success.
Roger Conner known to you as ThatsItImout
Peak Yesterday or in 20 years.
Hello, people? Hellooo?
Excellent essay! Jay Hanson came to the same conclusion. Whether Peakoil Yesterday, or in Twenty Years, he said the mass majority and especially the majority of our leaders will never change; it is in our Genes to seek MPP:
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"The Maximum Power Principle states that all open systems (Bernard cells, ecosystems, people, societies, etc.) evolve to degrade as much energy as possible while allowing for the continued existence of the larger systems they are part of."
"All species expand as much as resources allow and predators, parasites, and physical conditions permit. When a species is introduced into a new habitat with abundant resources that accumulated before its arrival, the population expands rapidly until all the resources are used up. In wine making, for example, a population of yeast cells in freshly-pressed grape juice grows exponentially until nutrients are exhausted -- or waste products become toxic."
-- David Price; http://dieoff.com/page137.htm
This is commonly seen in the pursuit of individual gain at the expense of the larger community. When individuals maximize gain, populations experience overshoot and die off.
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IMO, the best we can hope to do is to somehow optimize our decline for the squeeze thru the Bottleneck. I realize it is not much to go on--but remember, no other species ever had the mental capacity and understanding to even try.
Bob Shaw in Phx,Az Are Humans Smarter than Yeast?
Re "Maximum Power Principle"
You might enjoy reading Into The Cool by Schneider and Sagan. It takes you through the second law of thermodynamics with wonderful detail right into nonequilibrium metastable thermodynamic systems of which humans are an example. The conclusion matches yours.
If this would change, we would have a fighting chance at doing the right thing. Why is it that posterity as you say, or the desire to leave an admired, lasting legacy is no longer a value that seems to be held by many, but importantly, is also no longer held by those with money and power ?
You really only need look at the way our most lasting creations such as buildings have changed since the late 19th century.
Yes, WE do. I am not a seer and nobody I respect is one either. But some folks like Yergin or Lynch have a Chrystal Ball as they project the economic & technological happiness of the past onto the future.
You're writing a lot of stuff lately, Roger. What do you suggest we do about them? -- try to keep it pithy
Pithy? Does that sound like me? :-)
But, I will try....
Everyone here keeps saying things smiliar to, " when have you ever heard of people giving wealth/power/lifestyle/consumption however you want to say it, voluntarily, without crisis or without being forced.
That is why my argument, although it is not all that popular here, is that you have to trick um'. The first wave of consumption reductions have to be what the designers call "transparent", meaning that they are as invisible as a clean sheet of glass, in other words, the reducttion in consumption is built in in such a way as to be invisible, and in fact the product is actually superior in othr areas to older, dirtier designs, and in fact, hip or in style.
What have I just described? Herein lies the secret of the Toyota Prius Hybrid for example. All the reviewers say it performs as well as a gasoline car, it is smooth and quite, maybe even smoother and quiter at lower speeds than a gasoline car, and you have to go to the filling station less frequently, thus increasing the convenience factor (what a thought, convenience saving fuel instead of costing it!) Some of the newer hybrid sedans are seen by some road testers as superior in areas other than fuel mileage to their gasoline sister models (the Camry is a VERY good car, but as a hybrid, even in it's earliest generation, it may already be as good or better than it's companion gasoline model. At what point might it pay to just slowly phase out the gas only hybrid, as the batteries get even better. The upcoming generation of plug hybrids may be so quite and so convenient as to make people wonder why they ever tolerated gasoline only cars.
What other areas show possibilities of similiar advantage? AlanfromBigeasy often talks about electric rail for moving goods. That is a great case in point. The noise level goes down, the smoke level goes down, think how much nicer the sound and air would be in areas around railroad tracks with electric rail!
First for moving goods, and then advancing, as fuel prices advanced, to commuter and long haul rail. All the advantages, cleaner, quieter, and more convenient. There is the capital costs, but then, after that, it's the ultimate "hip" and stylish answer.
Geothermal or ground coupled heat pumps. I know of know one who does not rave about them once they actually own them, and not just on the basis of fuel economy, but on the basis of clean, convenient climate control. Winter /summer climate in one unit, no smoke, no fear of natural gas or propane fires and explosions, gas leaks killing the whole family in their sleep...poetic beauty as your household climate control lives it's whole existance in a 56 degree mild spring environment. It can be upsized to office buildings, shopping malls and Walmarts, the ultimate clean and conveneint alternative.
The last I will talk about now is distributed generation. This is just too hip....a small CHP unit in the basement or garage, that provides electric power, heat, hot water and cooling....all from one incoming natural gas line or propane tank. This may sound strange given that I just endorsed heat pumps, but they can work in tandem, and there are places where heat pumps will not work as well, in particular if your goal is being lit up when everyone else is down in a thundertorm, windstorm, blizzard or blackout, the ultimate one upping the Jones! The efficiency of distributed power can be fantastic, can make America more secure from terroists attack and more able to withstand weather events or fuel cutoffs. Photovoltaic solar can be mixed in, (how's that for status?), and Wind can be added to the grid where it is available. Pumped hydro storage can smooth out the day night peaks/valleys, and rescue almost a whole "second grid" worth of power from the off peak hours.
T avoid not being "un-pithy", I will stop there. Notice I have not used such examples as tar sands, ethanol, fusion nuclear, hydrogen fuel cells, nor a sizable number of other technologies, simply because these have not proven themselves. The ideas I listed exist now, can be implemented now, and in conjunction with the "transparent conservation" of insulation, solar oriented passive houses, North side protection of the wall, etc, could cut America's fuel consumption WHILE MAKING AMERICANS MORE SPOILED AND COMFORTABLE. Among the most edgy things I would recommend are the plug hybrids, and a line of hydraulic hybrid garbage trucks, school buses, and delivery trucks which would get 50% better fuel efficiency than conventional drive.
One more thing: Diversity of fuel supply. I actually read the other day that if the weather stayed unusually warm, the nat gas companies may actually have to "flare" some off due to no where to store it!!!!
In the age we are in, this is so barbaric so as to transcend reality. Does that really still go on. With no summer market for propane, methane or butane it actually could. We must, MUST examine dividing our fuel consumption up between LPG, natural gas, gasoline, Diesel, and grid provided power, plust the bio fuels that will be there whether we think they are a good idea or not.
Diversity, advanced design, "transparent" and "stylish" reductions in fuel that spoil us more...the amount of consumption reduction would be astounding, and the creative, artistic landscape of America would be an inspiration to our youth....and this is only the front edge.
Opps, I may have passed "pithy" a few lines ago! :-)
Thank you, Roger Conner known to you as ThatsItImout
Although Bush says we are addicted to oil; I'm sure he and the Republicans are pleased that oil and gas prices have gone down and we have found yet another "find" that will save us all --- at least until the next election. The alarm is only sounded when oil and gas prices are up.
Not quite. The longer it takes to get to the peak, the worse it will be - more people, less resources, steeper drop much further down.
In a cynical kind of way, it would be a good thing for humankind if the crisis arrived tomorrow.
For each individual, it would be a catastrophe, whether it arrived sooner or later, of course.
Good night from Old Europe,
Davidyson
It is the reality of human nature that requires us to recognize a problem as urgent and imminent in order to motivate change. I think there is enough evidence out there to paint a very urgent picture (in contrast to CERA, etc) which I guess is where we differ. No decision is made with absolute certainty when you enter into it
(marriage, career, house, etc) - you look at the data, make the best assessment you can, and take action.
I officially proclaim Hurricane Season over in GOMEX. Cheers.
So I guess he'll say its all abiotic- just wish he'd look at the geology on the paper that Dave Cohen posted the link to earlier.
Too bad that George Noory has become an adherent to the Abiotic theory- maybe he could get his 20 million or so listeners to donate a dollar each for a test well and get his remote viewing people to "locate" the oil prospects. Hell, the oil problem would solved instantly!
George is not an idiot, so I have to believe he was asking these questions on purpose.
I think something is up as Corsi and his lackey flew out to the LA studio for that first show. That is extremely unusual as almost all C2Cradio interviews are done via phone.
I'm debating whether to listen or not. The guy gets on my nerves.
I say to them prove it. Get the listeners to chip in and get the remote viewers find the spot. Go for it. Its just as credible as some of the oil projects being sold to investors now. Who needs 3 D Seismic when you can remote view. Back in the old days promoters used dowsers. This Corsi guy sounds like could use some dowsers to help him out.
This "discovery" is so deep in the water I'm suspicious given what a big deal is being made out of it. I'm not saying it's not there. But I wonder if Dick Cheney and our NSA overlords browsing these forums have realized people are catching on and thus instructed their minions in the MSM to flog this sucker to the peasants for all it's worth.
http://www.deepwater.com/pdf/Harts_EP_Aug_2004.pdf#search=%22transocean%20rig%20depth%20rating%22
Note Table 1 where water depth is listed at 8K and well depth listed at 18 to 28k. This was printed in 2004 and sounds like the parameters of this discovery.
One thing is for sure, these companies will need plenty of cash to take this one on. After some years of core evaluation and drill stem testing looks like they are going to stick their neck out.
I have been amazed when I first heard about the newer deepwater plays in the early 90's that they have been so successful with their safety record. I was invited several times to go there but I swore offshore work off 20 years ago.
One of the challenges that is detailed in the Harts article is round trip time. At 28,000 feet it takes a long time to get the pipe out of the hole and back in. There are limits as to how fast they can trip- particularly in geopressured environments and this new discovery certainly is. Trying to speed up this process can cause what is known as swabbing the well in. So they will have to be patient and take their time. I would hate for the safety record to be broken.
The subsea well heads are operating in an environment where pressures are in the range of 10,000 psi internal and 3,500 psi external. Quite a feat.
If they pull it off though, by 2013 the'll be getting $145/b so will be awash with cash.
Maybe ABC will do a miniseries about this find:
"The Path to Cornucopia"
I won't give an emotional rant about how this should be used as a bridging step to get us where we need to go. (Others on the site are much better at this than I). That is precisely how this discovery, along with others that may be found in the near future, should be seen.
I am not a new adherent to what we now call peak oil. Colin Cambell merely crystallized it for me in 1998 with his landmark article. I have worked in a broad range of energy industries including several attempts in the solar field going on 25 years now. I have had some severe defeats during this time frame, along with occaisonal minor victories. Most of the reasons why we have success and failure have nothing to do with technology. Technology has been a tremendous human force and has in fact improved our standard of living. But we are still human beings and subject to our mortal flaws.
This discovery will test techology and humans to an extent that only has been hinted at in our deepwater progress so far. There will be human beings on those rigs that will die to produce that oil. That is a sad fact in the oil business- no matter how safe you try to make it. It has always been that way.
So along with the cheering, maybe a few prayers are needed.
I have a very basic understanding of oil well drilling technology (thanks largely to some of the tutorials presented here at TOD), but I find it hard to fathom (pun not intended) how one can drill a well through some 7,000 ft of water followed by over 20,000 ft of earth's crust.
Even if it's large, thick-walled pipe, a length of pipe over 5 miles long must have the torsional rigidity of an overcooked strand of spaghetti. Even with liberal use of drilling muds, etc, at that extreme length the frictional forces acting on the pipe must be enormous, particularly if you start getting into directional drilling.
My engineer's intuition tell me that trying to insert something that deep and that long would be about as successful as trying to push a rope uphill. Yet, obviously, it is being done. Perhaps you could enlighten me on how it is possible to get a pipe in and out of a hole that long. What about casing? That must be pretty difficult too.
A drillstring might be over twenty thousand feet long, constructed mainly of 30-foot lengths ("joints") of drillpipe, screwed together, ID maybe 4.5 inches, 1 inch wall thickness, plain carbon steel. (Diameters are guessed - I'm not a driller). A structural member of this length and slenderness has basically zero buckling stability (compressive or torsional) under the forces associated with the drilling process.
The weight of the mud-filled drillstring in the hole is balanced by three forces:
- Hook load (at the top of the string)
- Buoyancy (mud in the hole)
- Weight on bit (WOB)
You will often need tens of thousands (Hundreds? Dunno) of pounds WOB. So the top of the drillstring is in tension, the bottom in compression. At some point there is zero axial force - this is called the "neutral point". The driller will adjust hook load to get the desired WOB.So the bottom of the drillstring is in compression. Why doesn't it buckle? The answer is that everything below the neutral point is built from much thicker i.e. buckle-resistant pipe (remember that buckle resistance is proportional to radius to the fourth power). These joints are called "drill collars" - despite their name they come in the same joint lengths (thirty feet) as regular drillpipe, with the same ID, but the OD is increased by a factor of 2 or so - obviously you leave enough clearance for mud and cuttings to circulate.
Compare drillpipe and drill collars here >>> http://www.glossary.oilfield.slb.com/DisplayImage.cfm?ID=318
Everything in the drillstring below the plain drillpipe (bit, drill collars and other strange and wonderful gadgets) is referred to as the Bottom Hole Assembly (BHA). Diagram (very much not to scale) here >>> http://www.glossary.oilfield.slb.com/Display.cfm?Term=bottomhole%20assembly
(Can't link the pics directly I'm afraid).
The answer re: casing is that it has a much bigger ID, so less prone to buckling, and you can run the casing with a bullet nose (with a mud vent at the bottom) to get it past irregularities in the open hole. The nose might even have a couple of rows of cutters so you can try to ream past obstructions if you are feeling lucky. You're just opening the hole slightly, not drilling ahead, so you don't need much weight to do this. The nose will be made of epoxy or concrete so once the casing is set and cemented you can just drill it out.
Next Question?
ID maybe 4.5 inches, 1 inch wall thickness
SHOULD READ
OD maybe 4.5 inches, 1 inch wall thickness
I and O are right next to each other on the keyboard...
That was very informative and helpful in giving me a better understanding of deep well drilling.
By describing the drill string as more of a weighted plumb bob, you've answered my question about torsional rigidity, etc. I guess the answer is that because the lower portion of the drill string is in tension, it doesn't need much torsional rigidity.
Anyway, I find it thoroughly amazing how the oil industry has perfected these advanced drilling techniques. It looks like a nice combination of art and science.
The pipe indeed buckles if too much weight is applied but more often than not the hole will deviate based on the path of least resistance of the rocks being drilled. In other words if the driller dumps weight the bit may follow the dip of the formation and you will miss the target. In the case of horizontal drilling the pipe will bend from 0 degrees to 90 degrees within a few hundred feet of radius. In short radius re-entry wells the pipe will bend from 0 to 90 degrees in little over a hundred feet. So yes the pipe is quite flexible.
There is the Bottom Hole Assembly as Plucky Underdog noted that consists of the bit (many different types depending on formation), a downhole mud motor is pretty much standard now even on straight holes, Non magnetic drill collars in which are the various MWD sondes for real time drilling information, and directional sensors. Following this is the appropriate number of heavy weight collars that provide weight near the bottom of the string and then following that is the joints that are added as they are drilled down. On a 28000 foot well there would be approximately 300 stands of pipe. Why this is important is the tripping time required to get this pipe in and out of the hole. It can take up to 24 hours to make a round trip on a deep hole. Even more if the well starts flowing and requires well control procedures.
The downhole mud motor is turning at say 60 rpm and the top drive is turning at 60 rpm so you have in this example a combined 120 effective rpm. You are surveying as you are drilling and can control the rates at which the bit builds it angle. This is important in controlling your "buckling" concept. The term is "dogleg"in the oil field and new rotary steerable mud motor technology makes this much easier on deepwater holes. Being able to limit the dogleg allows the pipe to be pulled easier and casing run smoother. Dogleg is measured in degrees per hundred feet and can be controlled to less than 1 degree.
Regarding mud, that is a whole science unto itself with things such as polymer beads being used to help with friction. Of course the mud provides some pipe buoyancy and bit cooling effects it provides pressure control. Say we have a geopressured zone at 28000 feet that has 15000 psi and we want to control it without blowing out. We could weight our mud up to 11 pound per gallon giving us appoximatley 16000 psi hydrostatic pressure. Of course this could be too much and fracture the formation and we'd lose circulation, we'd have to back off our weight and add Loss of Circulation Material (LCM) and have one hell of a time.
Oh well, I dont know if this has helped or confused you even more. I guess in a nutshell the drillstring concept is more like a pendulum or plumbob as opposed to pushing a limp noodle. The most significnat weight is at the bottom.
JC