Posted on 09/06/2006 9:36:29 PM PDT by thackney
The discovery of reserves in the Gulf of Mexico means supply isn't topping out
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WORLDWIDE DEPOSITS. Other parts of the world that once appeared beyond the pale may also come into play. Areas believed to have oil deposits extremely deep beneath the ocean floor, which could now become commercially recoverable, include the North Sea off the coast of Britain, the Nile River Delta off the coast of Egypt, and possibly coastal Brazil, says Andrew Latham, a vice-president at energy consultancy Wood Mackenzie in Edinburgh, Scotland. Other analysts say West Africa could harbor lots of ultra-deep deposits. The areas have produced oil before but never from these depths.
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Pioneering isn't cheap. Steel and skilled labor rates are going through the roof, as are rental rates for state-of-the-art offshore rigs. BP (BP), for example, will be paying $520,000 per day starting late next year for the same rig it is now getting for $190,000 per day. That's because these fancy rigs, which house 200 people and rise 415 feet into the air, are in short supply with drilling picking up. Still, energy experts believe that producing oil from ultra-deep wells can be profitable as long as oil, selling for $67 per barrel today, stays at or above $40 to $45.
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But given the powerful combination of high oil prices and new technology, the industry is gaining confidence that supplies will grow. It's pushing hard to produce oil and gas from difficult tar sand and shale fields as well as rejuvenating older fields with enhanced recovery methods. Cambridge Energy Research Associates predicts world oil and natural gas liquids capacity could increase as much as 25% by 2015. Says Robert W. Esser, a director of CERA: "Peak Oil theory is garbage as far as we're concerned."
(Excerpt) Read more at businessweek.com ...
I think we will make some new energy breakthrough before we ever run out of oil. Millenia of decaying matter made that oil, we arent going to burn it all up in a few hundred years try as we may.
I think that the decaying matter theory of oil is starting to whither. Others who follow this closely may weigh in but last I heard, there is just too much oil to come from a big biomass deposit.
The Genesis Flood?
Abject nonsense. Don't judge the issue by what you see on Free Republic.
Oil comes from dead plankton. Of all the weight of living matter on earth, 90% of it is in the ocean and 90% of that is plankton...multiply that by hundreds of millions of years of short-lived plankton dying, and even when you consider only a tiny fraction of that ends up as petroleum, that's more than enough for all the oil discovered.
The cost is because of unions holding guns to people's heads IMO.
Shhhh. Don't tell the democrats. They think oil comes from dinosaurs and we are going to run out any year now. When I was in elementary school I told my teachers that it made so sense that oil came from dinosaurs. Of course, I also argued with my physics professors about the inadequacy of the theory of gravity so maybe I was just born confrontational.
and yet there are Dems still arguing Hubberts Peak theory despite it having been debunked for 40 years now (since we obviously haven't run out of oil in 1965 as he predicted). I don't think we've even located HALF of the existing oil out there. We aren't even allowed to really look in places where there are such high prospects (Venezuala, Brazil, Alaska, Colorado, Montana, Iraq, Iran) for more huge deposits.
There is a theory that certain enzymes rejuvenate oil fields. I read about it long ago, it may be debunked, but the tests showed putting these enzymes into wells that have been mostly pumped propegate the oil... it may be possible that the enzyme triggers oil to reproduce itself, or cause newer vegetation to turn to oil much more quickly.
Anyone else read about this? Haven't seen it mentioned except once many years ago.
Unless the Earth was originally formed of biamass when the galactic dinosaurs all died off.
I agree.
Forget peak oil we are actually approaching Peak Debt
BUMP
I think that the decaying matter theory of oil is starting to whither. Others who follow this closely may weigh in but last I heard, there is just too much oil to come from a big biomass deposit.
abiotic oil tin foils for everyone
You paint such a broad brush thinking I gather my news from Free Republic exclusively. This issue of where oil comes from has been questioned by loads of people. The 'theory' of it coming from decaying plants and dinosaurs has been out there forever but it is unproven AFAIK.
I am not a religious guy just someone that says dogma doesn't make it fact.
I refer you to the following:
Article 16 of 200
It's No Crude Joke:
This Oil Field Grows
Even as It's Tapped
---
Odd Reservoir Off Louisiana
Prods Petroleum Experts
To Seek a Deeper Meaning
By Christopher Cooper
04/16/1999
The Wall Street Journal
Page A1
(Copyright (c) 1999, Dow Jones & Company, Inc.)
HOUSTON -- Something mysterious is going on at Eugene Island 330.
Production at the oil field, deep in the Gulf of Mexico off the coast of Louisiana, was supposed to have declined years ago. And for a while, it behaved like any normal field: Following its 1973 discovery, Eugene Island 330's output peaked at about 15,000 barrels a day. By 1989, production had slowed to about 4,000 barrels a day.
Then suddenly -- some say almost inexplicably -- Eugene Island's fortunes reversed. The field, operated by PennzEnergy Co., is now producing 13,000 barrels a day, and probable reserves have rocketed to more than 400 million barrels from 60 million. Stranger still, scientists studying the field say the crude coming out of the pipe is of a geological age quite different from the oil that gushed 10 years ago.
All of which has led some scientists to a radical theory: Eugene Island is rapidly refilling itself, perhaps from some continuous source miles below the Earth's surface. That, they say, raises the tantalizing possibility that oil may not be the limited resource it is assumed to be.
"It kind of blew me away," says Jean Whelan, a geochemist and senior researcher from the Woods Hole Oceanographic Institution in Massachusetts. Connected to Woods Hole since 1973, Dr. Whelan says she considered herself a traditional thinker until she encountered the phenomenon in the Gulf of Mexico. Now, she says, "I believe there is a huge system of oil just migrating" deep underground.
Conventional wisdom says the world's supply of oil is finite, and that it was deposited in horizontal reservoirs near the surface in a process that took millions of years. Since the economies of entire countries ride on the fundamental notion that oil reserves are exhaustible, any contrary evidence "would change the way people see the game, turn the world view upside down," says Daniel Yergin, a petroleum futurist and industry consultant in Cambridge, Mass. "Oil and renewable resource are not words that often appear in the same sentence."
Doomsayers to the contrary, the world contains far more recoverable oil than was believed even 20 years ago. Between 1976 and 1996, estimated global oil reserves grew 72%, to 1.04 trillion barrels. Much of that growth came in the past 10 years, with the introduction of computers to the oil patch, which made drilling for oil more predictable.
Still, most geologists are hard-pressed to explain why the world's greatest oil pool, the Middle East, has more than doubled its reserves in the past 20 years, despite half a century of intense exploitation and relatively few new discoveries. It would take a pretty big pile of dead dinosaurs and prehistoric plants to account for the estimated 660 billion barrels of oil in the region, notes Norman Hyne, a professor at the University of Tulsa in Oklahoma. "Off-the-wall theories often turn out to be right," he says.
Even some of the most staid U.S. oil companies find the Eugene Island discoveries intriguing. "These reservoirs are refilling with oil," acknowledges David Sibley, a Chevron Corp. geologist who has monitored the work at Eugene Island. Mr. Sibley cautions, however, that much research remains to be done on the source of that oil. "At this point, it's not black and white. It's gray," he says.
Although the world has been drilling for oil for generations, little is known about the nature of the resource or the underground activities that led to its creation. And because even conservative estimates say known oil reserves will last 40 years or more, most big oil companies haven't concerned themselves much with hunting for deep sources like the reservoirs scientists believe may exist under Eugene Island.
Economics never hindered the theorists, however. One, Thomas Gold, a respected astronomer and professor emeritus at Cornell University in Ithaca, N.Y., has held for years that oil is actually a renewable, primordial syrup continually manufactured by the Earth under ultrahot conditions and tremendous pressures. As this substance migrates toward the surface, it is attacked by bacteria, making it appear to have an organic origin dating back to the dinosaurs, he says.
While many scientists discount Prof. Gold's theory as unproved, "it made a believer out of me," says Robert Hefner, chairman of Seven Seas Petroleum Inc., a Houston firm that specializes in ultradeep drilling and has worked with the professor on his experiments. Seven Seas continues to use "conventional" methods in seeking reserves, though the halls of the company often ring with dissent. "My boss and I yell at each other all the time about these theories," says Russ Cunningham, a geologist and exploration manager for Seven Seas who isn't sold on Prof. Gold's ideas.
Knowing that clever theories don't fill the gas tank, Roger Anderson, an oceanographer and executive director of Columbia University's Energy Research Center in New York, proposed studying the behavior of oil in a reservoir in hopes of finding a new way to help companies vacuum up what their drilling was leaving behind.
He focused on Eugene Island, a kidney-shaped subsurface mountain that slopes steeply into the Gulf depths. About 80 miles off the Louisiana coast, the underwater landscape surrounding Eugene Island is otherworldly, cut with deep fissures and faults that spontaneously belch gas and oil. In 1985, as he stood on the deck of a shrimp boat towing an oil-sniffing contraption through the area, Dr. Anderson pondered Eugene Island's strange history. "Migrating oil and anomalous production. I sort of linked the two ideas together," he says.
Five years later, the U.S. Department of Energy ponied up $10 million to investigate the Eugene Island geologic formation, and especially the oddly behaving field at its crest. A consortium of companies leasing chunks of the formation, including such giants as Chevron, Exxon Corp. and Texaco Corp., matched the federal grant.
The Eugene Island researchers began their investigation about the same time that 3-D seismic technology was introduced to the oil business, allowing geologists to see promising reservoirs as a cavern in the ground rather than as a line on a piece of paper.
Taking the technology one step further, Dr. Anderson used a powerful computer to stack 3-D images of Eugene Island on top of one another. That resulted in a 4-D image, showing not only the reservoir in three spatial dimensions, but showing also the movement of its contents over time as PennzEnergy siphoned out oil.
What Dr. Anderson noticed as he played his time-lapse model was how much oil PennzEnergy had missed over the years. The remaining crude, surrounded by water and wobbling like giant globs of Jell-O in the computer model, gave PennzEnergy new targets as it reworked Eugene Island.
What captivated scientists, though, was a deep fault in the bottom corner of the computer scan that was gushing oil like a garden hose. "We could see the stream," Dr. Anderson says. "It wasn't even debated that it was happening."
Woods Hole's Dr. Whelan, invited by Dr. Anderson to join the Eugene Island investigation, postulated that superheated methane gas -- a compound that is able to absorb vast amounts of oil -- was carrying crude from a deep source below. The age of the crude pushed through the stream, and its hotter temperature helped support that theory. The scientists decided to drill into the fault.
As prospectors, the scientists were fairly lucky. As researchers they weren't. The first well they drilled hit natural gas, a pocket so pressurized "that it scared us," Dr. Anderson says; that well is still producing. The second stab, however, collapsed the fault. "Some oil flowed. I have 15 gallons of it in my closet," Dr. Anderson says. But it wasn't successful enough to advance Dr. Whelan's theory.
A third well was drilled at a spot on an adjacent lease, where the fault disappeared from seismic view. The researchers missed the stream but hit a fair-size reservoir, one that is still producing.
It was here, in 1995, that the scientists ran out of grant money and PennzEnergy lost interest in continuing. "I'm not discounting the possibility that there is oil moving into these reservoirs," says William Van Wie, a PennzEnergy senior vice president. "I question only the rate."
Dr. Whelan hasn't lost interest, however, and is seeking to investigate further the mysterious vents and seeps. While industry geologists have generally assumed such eruptions are merely cracks in a shallow oil reservoir, they aren't sure. Noting that many of the seeps are occurring in deep water, rather than in the relative shallows of the continental shelf, Dr. Whelan wonders if they may link a deeper source.
This summer, a tiny submarine chartered by a Louisiana State University researcher will attempt to install a series of measuring devices on vents near the Eugene Island property. Dr. Whelan hopes this will give her some idea of how quickly Eugene Island is refilling. "We need to know if we're talking years or if we're talking hundreds of thousands of years," she says.
(See related letter: "Letters to the Editor: Mystery Oil Flowed Via `Paper Pipeline' " -- WSJ May 18, 1999)
Sorry, but this does nothing to enhance the concept of abiotic theory of oil except to those who do not understand geology.
I don't believe you will find many oil rigs workers that are union members. Louisiana, Texas, Oklahoma, Mississippi and Alabama are all right-to-work states.
This is strictly a supply and demand issue. The demand for oil rigs in a sustained high price market for oil is very high.
There is nothing showing that to be true. Hydrocarbon molecules under heat and time break down, not form more complex molecules.
The deep oil plays (quite a few developing around the world) are very interesting because they are coming from geologic structures that indicate oil was forming and getting trapped in sedimentary rock hundreds of millions of years earlier than theorized.
Because most of these structures are deeper, they are under higher pressure and more of the oil will be recoverable over a longer period of time.
There are lots and lots of these older sedimentary structures around the world so it is possible oil reserves will increase substantially over the next several years as more of these structures are found to contain big oil pools.
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