Carousel of Unconventional Progress

In 1971, Walt Disney World held its grand opening in Florida. My entire family was there on that day, and, for many years to follow, we made our annual pilgrimage to the Magic Kingdom. While it was loads of fun, many of the attractions were educational and designed to inspire. For me, Walt Disney’s Carousel of Progress in Tomorrowland was a pivotal attraction. The Carousel of Progress depicts a typical American family and explores the joys of living through technological advances across different time periods, including speculation about how these improvements might continue into the future.

Like the Carousel of Progress, the cultivation of unconventional technology can be seen in its history; from its humble beginnings, with the first artificially stimulated, shale gas well in 1821, through the development of multi-stage hydraulic fracturing in the early 2000s, and today with pad drilling, lean manufacturing techniques, and environmental management.

To speculate about the future of unconventional technology, we need to look back on 2014. We’ve seen, in the last year, market and regulatory challenges, supply-demand pressures, and ecological concerns, tempered with a deeper understanding of the subsurface, drilling technology, and production systems. The U.S. Energy Information Administration reported in its latest monthly figures, that crude production from the U.S. was 8.9 MMbopd, which is about 10% of world production. Unconventional plays contribute roughly 40% to this output. This ramp-up in activity, and the success in these unconventional plays, are driven by operational efficiencies that reduce cycle time and costs; conducting operations safely; and being a champion of environmental stewardship.

Technological advances in imaging, and modeling flow through porous media at micro and nano scales, have improved significantly. These advances allow for greater reservoir simulation and a deeper understanding of the geological forces affecting pore-scale morphology. New logging tools are perfecting our understanding of reservoir characterization and well placement. Pad drilling and down-spacing are improving recovery, and, in combination with lean manufacturing and global supply chain efforts, cycle time and costs have improved dramatically.

So, in our evaluation of the “Carousel of Unconventional Progress,” what can we say? The current industry focus is on water management; the reduction of gas flaring; improvement of crude oil transportation via rail and pipelines; and monitoring of induced seismicity and its mitigation. Additionally, we continue to educate the public and regulators on the progress that we’ve made, and our social and environmental stewardship. Technological advances will be achieved in well placement and improved microseismic monitoring. Better understanding of hydraulic fracture models will evolve from current, simple planar models to complex, fracture system models. The ability to look ahead of the drill bit to find sweet spots will lead to better efficiencies.

As the “Carousel of Unconventional Progress” turns even farther into the future, there will be breakthrough technologies to impact ultimate recovery and efficiency in the development of fossil fuels. Renewable resources, such as solar, wind, geothermal, hydroelectric and biomass, make up less than 9% of the current energy supply. It is unlikely, with world population expected to grow by 2 billion people by 2040, that renewables will make a significant impact to meet society’s needs. The International Energy Agency estimates worldwide energy demand will increase as much as one-third by 2040, and fossil fuels will represent over 75% toward meeting that demand. Breakthroughs that are likely to be significant to meet this demand will focus on cleaner use of current non-renewable energy sources, such as petroleum, coal and natural gas.

The goals for technology and innovation address three areas: growth, sustainability and environmental stewardship. While too many to list individually, these 2014 highlights showcase the industry’s focus on advancement.

As the “Carousel of Unconventional Progress” turns, 2015 looks to be equally impressive for new ideas and breakthrough concepts. At this year’s Unconventional Resource Technology Conference in Denver, there were sessions on emerging new plays, transferring knowledge to global unconventionals, new approaches to gas flaring and water utilization, advancements in well integrity, and the mitigation of environmental impact issues around infrastructure, noise, dust, and traffic congestion, along with the application of enhanced recovery methods, CO₂ sequestration, and new workflows that embrace a multidisciplinary approach.

Indeed, the future for unconventional technology is bright, and I predict that the next time Disney updates the Carousel of Progress in Tomorrowland, unconventional resources will fuel the future electrical and technological advances for our civilization.