Editorial Comment

	Vol. 227 No. 6
PERRY A. FISCHER, EDITOR

EOR: Not sexy, but it works. As a result of recent discussions with several highly experienced oilfield engineers, a theme has been emerging. I noticed it quite by accident. It’s a drum that the US Department of Energy has been beating for decades: Truly vast amounts of oil are to be found by increasing the recovery factor.

The engineers were all from major oil companies. One fellow told me, “You might not believe it, but we significantly increased the amount of oil we produced simply by measuring how much water we were injecting.” Of course, the company did the simulation studies, drilled the water-injection wells, built the water-treatment plant and measured the gross water inputs, but they hadn’t thoroughly measured how much water each injector was injecting. When they did, they discovered that they were injecting far less than they should have. Once they remedied the situation, oil production increased considerably.

Another engineer said that, after meticulous modeling and experimentation, the company was not injecting enough gas in a gas-lift operation. When they optimized the gas, oil production increased.

Yet another guy with oil in his veins told me a story of how they were having trouble maintaining pressure with a carbon dioxide (CO₂) flood. Earlier attempts to “plug up” leaky formations had been ineffective. Finally, in a leap of faith – but still based on experience – the company ordered and successfully injected over 10,000 barrels of gel and cement, thereby appreciably increasing oil production.

As I wrote in this column in April, we are not using enough CO₂ in the US, indeed, in any country where mature fields exist with favorable geology – and that’s a lot of fields, probably a majority. The DOE report that I cited had made the case that, in addition to not consistently applying the best technologies and practices, we are too often not injecting enough CO₂.

So, that’s the theme: The DOE is right – most of the world’s remaining oil can be “found” through Enhanced Oil Recovery (EOR) and, in many cases, we are simply not applying what we know, or should have learned. This is the message that I’m getting; and, of course, it’s not as simple as just pumping/ injecting more fluids into the ground. Put more simply, if we are recovering 33% of the oil that’s been found, and that represents most of the world’s oil that’s been produced – about a trillion barrels – raising that recovery to just 50% would add several hundred billion barrels of oil production.

The IOR (Improved Oil Recovery) Symposium, held in April and sponsored by DOE and SPE, drew 620 people, up from recent years. Given the potential and today’s prices, you would think that it would be one of the biggest oilfield conferences of the year. I guess it’s just not as sexy as finding a big new field.

CO₂ celebration. While on the subject of CO₂, just in case you missed the news blitz and other fanfare that never happened, it was announced early this year that the US had produced its billionth barrel of oil resulting from CO₂ injection. It sort of reminds me of that old saying, “A billion here, a billion there, sooner or later, it starts adding up to real money.”

I find it wonderfully ironic that the IPCC – yes, that IPCC, the UN panel on global warming, or, as some have written to tell me, the dreadful IPCC that is conspiring with 11 countries’ National Academies of Science to usurp America’s greatness – endorses the use of CO₂ injection for oil recovery. Another irony is the problem of finding enough CO₂. By some quirk of geology, the state of New Mexico and the surrounding area is blessed with an abundance of the stuff, but farther away, oil companies will have to find it wherever they can, if at all, even if it means sequestering CO₂ from power plants.

There’s no agreement among the major oil companies, or the minors or independents for that matter. Oil companies’ feelings about global warming seem to be about as diverse as the rest of the public and, not surprisingly, usually divided along the same ideological lines as the general public, with science often taking a back seat.

Shell and Statoil are planning a $1.5 billion – the world’s largest – CO₂ EOR project. They’ll have to get their CO₂ from a newly built gas-fired power plant and methanol production facility in central Norway, and then pipe it to the offshore Draugen and Heidrun fields.

BP’s Carson Hydrogen Power project will convert the carbon in petroleum coke and recycled waste water into hydrogen and CO₂. The hydrogen will fuel a 500-MW integrated gasification combined cycle (IGCC) power station. The CO₂ will enhance existing oil production, presumably in OXY’s nearby fields. The companies are discussing the matter. OXY now produces about 85,000 barrels a day from CO₂ injection. When completed, the project will be the largest hydrogen-fired power generation facility of its type in the world, producing 500 MW of low-carbon electricity for California, enough for a half-million homes. Success of the project might depend, in part, on federal subsidies for new gasification technology.

Nice try. US Congressman Ted Poe, a Texas Republican, tried to get legislation passed that would have lifted all (offshore) OCS moratoria for oil and gas exploration and production. With all of the bad publicity about high gasoline prices, you might have thought that there was a chance. Wrong. The amendment was crushed, 279 to 141.

However, on a more encouraging note, Congressman John Peterson, a Pennsylvania Republican, tried a similar amendment, but only to lift the OCS moratoria on natural gas production. It, too, was voted down, but by a more encouraging 217-to-203 defeat. I’m not sure how you avoid accidentally hitting oil while drilling for gas. Nor what you do with condensate. I suppose you have to plug and abandon any discoveries that are too oily?

Dear Dave. And to reader Dave, who wrote to tell us that World Oil’s columns are too long, “The mind can only absorb what the ass can endure,” we plead guilty – we do indeed have the longest columns in the business. Dave, it might help to read our columns in two sittings: first, the right half, then, the left.