To the uninitiated the thought of a gas or oil well is one where a pipe goes down into the ground, and out of it flows either a steady stream of oil or natural gas, that is fed straight into a pipeline and then delivered to them (often at what they consider to be an outrageous price) with no further treatment. Or the crude oil that comes out runs straight over to a refinery where (with minimum effort and maximum profit) it is transformed into the gasoline or diesel fuel that they must then again buy at great cost in order to drive in to the liquor store to buy some beer.*

The reality of oil and gas production is considerably different, and fluid that comes out of the well is not the ideal that the uninitiated imagines. So today’s topic will deal with the initial separation of a couple of the parts. This is a part of a series of tech talks that I write on Sundays about various aspects of fossil fuel production. It is a relatively simplistic explanation which seems to fit most folks needs, though it also has considerable help from those with more technical knowledge who add comments.

Chevron's Wheatstone gas field has long been the subject of a tug of war between Chevron (who want to develop it themselves - at one point talking up the possibility of building a GTL plant) and Woodside, who want to use the gas as feedstock for their second Pluto LNG train, which will shortly begin construction at the Burrup Penninsula.

It appears that Chevron have found a customer for the gas at last, with weekend press reports trumpeting a "$90 billion" gas sale to Japanese power company Tokyo Electric. The development is expected to produce 4.1 million tonnes of LNG exported each year. A final decision on the project is expected in 2011.

When we began this series of tech talks, a drilling rig was anything that punched a hole through the ground, to get at the oil or natural gas underneath. Once a hole is drilled, however, there is often other work that needs to be done on the well, but now the infrastructure that helped when we drilled the well starts to get in the way when we need to do other things. And so the tool will change to what is known as a workover rig. (Though these could be the old rigs left in place on a platform after the production wells are drilled - just to keep life clear).

This post is one of my series of tech talks, describing some of the ways in which fossil fuels are produced. In the current part of the series we are focusing a little more on the procedures that are being used to recover natural gas from formations such as the Barnett, Fayetteville, Marcellus, Haynesville and Woodford shales. In this particular post I am going to concentrate more on the benefits of horizontal drilling through these shale reservoirs, rather than using the more conventional vertical wells that were used historically. This, and the next three posts in the series are likely to be a bit more technically dense than earlier posts, but I am trying to illustrate some of the problems of production, and some of the gains that technology is bringing to help solve some of them. And while the reason for the horizontal wells can be simplified in this graph from Chris McGill, there are a lot of other things that have to be considered in deciding whether or not the horizontal well is going to be worth developing.

Comparative production from a vertical and horizontal natural gas well (Chris McGill).
Notice the gain in production, but much shorter life of the horizontal well.