Giant Oil Fields Report by Uppsala Univ

seahorse2 · Expert Joined: Oct 18, 2004 Posts: 1824

I'm linking the following report here. It has captured the attention of several here, including Rockman, a reserve geologist in Texas who has 30 years experience in the oil industry. Hopefully, he will continue to review and post comments about this report.

ROCKMAN

Here's the link from another thread that got our attention. It's the most up todate, accurate and well documented report on the technical side of PO I've seen.

Giant Oil Fields?

Below is a short bit but my all means read the entire thesis if you want to see some serious (and very supportive) number crunching.

"Notably, in all scenarios, future oil production is governed by the the giant fields and when they start to decline the rest of the liquids follows at the same time or a few years later (figure 9.3).
The main difference in the different scenarios is the peak production
level, where the worst case scenario peaks at just above 83Mbpd in 2008 while the best case scenario reaches a peak level of 94Mbpd in 2013 (figure 9.4). Thus the time span is only 5 years but the production level span is 11 Mbpd."

And to add some credibility (from another PO site):

"Fredrik Robelius, member of the Uppsala Hydrocarbon Depletion Study Group, UHDSG, Uppsala University in Sweden, defended on March 30 his thesis “Giant Oil Fields – Highway to Oil”. The university had appointed Dr. Robert Hirsch to be the official opponent in the oral defense of the thesis.

In the final remarks Dr Hirsch concluded that the peak oil debate now reached a new level. The fact that the forecast openly can be studied in detail and that limits are given it’s now up to CERA and other to explain in details why they end up in other forecasts. If not, the forecast from Uppsala Hydrocarbon Depletion Study Group is the one that the world should use for future planning"

ROCKMAN

Here's that link again:

Giant Oil Fields?

pedalling_faster · Intermediate Crude Joined: Dec 10, 2005 Posts: 767

zberry · Heavy Crude Joined: Mar 21, 2006 Posts: 133

Thanks! Uppsala is the university of Kjell Aleklett, ASPO and Professor of Physics
His presenation at the 2005 National Acadamies Workshop on Oil Supply, Demand and Peaking in Production titled "From the Outside Looking In" was brilliant. A tour de force!

National Acadmies Workshop on Oil

ROCKMAN

pedalling_faster,

I know all the different projections folksthrow around can be confusing. The reason I encouraged this thread was the approach this Swede used. He actually studied all the major oil fields in the world in order to get an accurate characterzation as possible. He still has to make a variety of assumptions to reach his conclusions but he has much more concrete info in his model then I've ever seen elsewhere.

Keep an eye on the thread and see what the critcs and prisers have to say.

I gather you think his most optimistic projection of peak production reaching at 94 million BO per day of oil in 2013 as good news. It's actually far from it. The pie eyed optimistists out there are saying "don't worry...we'll be producing 130 million BO per day in 2035". If the growth of oil consumption continues as most currently project then by 2013, if the Swede is right, it won't be just a question of higher oil prices but an actual shortage. In other words, even if you can afford the price it some oil requirements won't be meet for someone.

I f you read the Swede's thesis you'l see he doesn't predict the future as good or bad. He just says his work reliably shows oil production will follow a certain path.

Hang in there and don't let any technobabble frustrate you.

Revi · Fusion Joined: Apr 25, 2005 Posts: 3112 Location: Maine

I like it. We can reasonably plan what's going to happen now. I think we are on a plateau until around 2010 or 2012, but who knows? This is a great find. We can actually plan what's going to happen now.

Peak oil is a reality.
_________________
Deep in the mud and slime of things, even there, something sings.

DantesPeak

AirlinePilot

This kind of supports my own conclusions that things will start going downhill inside of 2-3 years. It seems as most of us who have followed this will attest, as time goes on the negative news has become the more accurate harbinger of what actually transpires. I'm thinking we start off the plateau we are on sometime between 2009-2011. After that, without real action the potential for ugly things gets very large. Right now I think it is going to be possible to hold on to the past and play the blame game, but that wont last very long. Typically we will waste precious time doing exactly that.

The bottom line is it appears we have a bit more time to prep than some here may have thought.

rockdoc123 · Light Sweet Crude Joined: May 16, 2005 Posts: 1671

Several years ago I posted somewhere on this site my projection for peak oil which was based on data from WoodMac and IHS Energy along with a bit of editing based on my own knowledge in some of the projects. That analysis gave a peak somewhere between 2012 and 2015 so I'm not surprised by the results of the report. That being said something that is being missed in the analysis I believe is not what the actual peak is but rather what the plateau looks like. Almost all of the assumptions that go into the WoodMac and IHS Energy views on reserves and production deal with 2P volumes. Little in the way of credit is given to "technical" reserves as WoodMac refers to them. These could be from field extensions or from improved recovery from existing wells. Improving recovery factors is definitely something that can be done and with increasing technology we may see more and more reserve growth in the future. What this would do is not increase actual peak but rather prolong the plateau to something that looks rather bumpy with a slow but steady decline followed by rapid accelarated decline once recovery factors have been maximized.

evilgenius

TheDude

Glad this study is getting some attention here!

ROCKMAN

evilgenius,

You're right...some techniques (horizontal drilling) can have great intial flow rates but then often decline rapidly. Others (CO2 injection) will often start slow but then show steady but at relatively slow rates.

In general though, it's important to know how almost all oil companies (especially publicly owned one) looks at economics. The ultimate volume of recovered oil isn't nearly as important as the rate of return on the investment. And the ROR hangs on the initial flow rate more than anything else. This true for enhanced recovery projects as well as all the resource plays you hear about now.

Take the new resource play in the Bakken Shale as an example. Vertical completions just don't deliver flow rates sufficient to make the economics work. It may come as a little surprise but the ultimate recover of a proposed well is not considered a major factor by the oil industry. I've been running economic analysis of drilling deals for over 30 years. The key economic consideration (beside the probability of success) is the rate of return on the investment. And this is tied directly to the cash flow from the well. In other words, how quickly will the net production pay back the investment. Even though drilling costs have increased greatly, horizontal completions can payout in 12 to 18 months yielding a 30% to 100% rate of return. It may sound odd but if an operator had to choose between two prospects where one recovered twice as much oil as the other they would choose the lower ultimate recovery project if the rate of return were significantly better. This is particularly true of public companies who are judge quarterly and not over the life of their production stream.

Dude ... really don't need the Feds pushing EOR. For some of the majors it's about all they have left. A story I've seldom seen is ExxonMobil latest statements regarding a major shift in their biz plan. They had been dumping ten's of billions of $'s into international exploration looking for the big ones. They have announced that due to high costs and ever decreasing opportunities they are shifting their empahsis to enhancing production from their existing assets. Some of their oldest fields from the 50's and 60's still hold huge amounts of oil. But the bad news is that they have working EOR on those fields for decades.

Given the high price of oil this statement sound contradictory but the exploration/production side of ExxonMobil is a dying business. Not that there isn't a lot of oil left to find but because EM is so big and produces so much that they've reached a point where they can't replace their declining rates. For the last two years both EM and Shell have seen the average daily production decrease year -to - year. I believe this is the first time that has happened in over 50 years. These companies have gotten so big that adding net values year-to-year is almost impossible. In a way, it's a similar story to what we're seeing in worldwide oil production: we're producing such a huge volume that it's not possible to replace that volume with new production.

Since EM can't find enough places to drill new wells they are shifting to fields they already own. It might help stablize the bleeding for a while but they are on an unending downward spiral on production rates....and this is a death march for a public E&P company in the long run

TheDude

ROCKMAN

Dude,

Have you dug into ExxonMobil's asset sheets? I'm not sure how they are spead now but I was shocked to see (about 15 years ago) that XOM's real estate assets were worth (at least on paper) many times what their oil&gas assets were valued. Few people realize how many developments are owned by XOM because they don't use the ExxonMobil name. I know Fairfield is one of their big subs.