[dolanbaker]

Oilfinder, eat your heart out!

http://www.bbc.co.uk/news/business-32229203
Before we get too excited, we'll need to know how much it will cost to get out of the ground.

There could be up to 100 billion barrels of oil onshore beneath the South of England, says exploration firm UK Oil & Gas Investments (UKOG).

Last year, the firm drilled a well at Horse Hill, near Gatwick airport, and analysis of that well suggests the local area could hold 158 million barrels of oil per square mile.

But only a fraction of the 100 billion total would be recovered, UKOG admits.

The North Sea has produced about 45 billion barrels in 40 years.

"We think we've found a very significant discovery here, probably the largest [onshore in the UK] in the last 30 years, and we think it has national significance," Stephen Sanderson, UKOG's chief executive told the BBC.

UKOG says that the majority of the oil lies within the Upper Jurassic Kimmeridge formation at a depth of between 2,500ft (762m) and 3,000ft (914m).

[ROCKMAN]

A bit of geology: The Kimmeridge Clay is arguably the most economically important unit of rocks in the whole of Europe, being the major source rock for oil fields in the North Sea hydrocarbon province. The oil and gas accumulations of the province are considered part of a single petroleum system: the Kimmeridgian Shales Total Petroleum System (TPS). Source rocks of the Kimmeridgian Shales TPS were deposited in Late Jurassic to earliest Cretaceous time during the period of intensive exten-sion and rifting. The Kimmeridgian Shales contain typical “type II” mixed kerogen. Oil and gas generation began locally in the North Sea Graben Province by Cretaceous time and has continued in various places ever since.

If they are correct about the not needing to frac the formation it might be analogous to the Austin Chalk formation in Texas that was the hottest oil play on the planet in the 90’s. Though the AC was made of carbonate material the reservoir dynamics would be very similar: naturally fractured reservoir with a high initial production rate with a rapid decline rate yielding a relatively low recover rate. The key to economically developing was not only horizontal drilling but also accurately targeting those areas with higher concentrations of natural fractures. Though more expensive to drill hz wells would be advantageous from the standpoint of minimizing the development footprint as a result of pad drilling.

As far as costs go someone is going to have to risk a fair number of pilot holes (I'm guessing 30+) to get a handle on the economics. Cost is only one part of the economic model. Initial flow and decline rates will also play a decisive role.

[GHung]

How much gas is typically associated with this type of formation?

Anyway, a story about this just popped up at CNN/Money: http://money.cnn.com/2015/04/09/investi ... l?iid=Lead . I'm sure their regular anti-peakers will make a big deal of this in the comments.

edit - Yep. First comment; "OK, is this "Peak Oil", or will it be after the next huge discovery?"

[ROCKMAN]

Ghung – It varies a good bit…typically by depth. Hence the shallow “oil window” in the Eagle Ford Shale and the deeper “gas window”. But even the shallower Austin Chalk oil play had a good bit of associated NG. Which led to a very “exciting” development method: underbalanced drilling. In order to prevent formation damage wells were drilled horizontally with lower mud weights that were insufficient to prevent the formation from flowing. Essentially it was a controlled blowout…seemingly a contradiction in terms. While drilling thru the AC it was actually flowing hundreds of bbls of oil and a lot of NG that was flared on location. Needless to say a rather high pucker factor for the hands on location. LOL.

[M_B_S]

http://www.bbc.com/news/business-32229794

Exploration firm UK Oil & Gas Investments (UKOG) says it has made "a very significant discovery" of oil in southern England that could amount to 100 billion barrels. But is it really there, and how easy will it be to get at it?
How big a find is this?
The find is - in theory - a huge one. Even so, UKOG have said that out of 100 billion barrels potentially underground, only an absolute maximum of 15 billion barrels could be extracted from the field.
Nonetheless, this would be 10 times bigger than the biggest oil field found in the last 20 years in the North Sea.
**********************************************

Wow! and onshore !

[ROCKMAN]

They didn't find an "oil field". They are describing a shale source rock that's been known for decades. See: "Oil discovery near Gatwick airport 'significant'" thread for details

[KaiserJeep]

I can tell: They want your money to develop this "new" and "giant" oil field.

Step one would always be an optimistic discovery announcement. Check.

Step two will be to overcome the main impediment: "But the oil is sitting under wealthy residential suburbs and protected environmental areas."

Step three would be to frack it and steam it out (or whatever tech is appropriate). It should be interesting to watch the legal shenanigans over already highly controversial extraction technologies in a country as Socialist as the UK.

[dolanbaker]

There is only one certainty with this "find" and that is that the nimby's will be out in force, many, many rich nimby's. That alone makes it unlikely that any significant extraction is undertaken.

[ennui2]

The NIMBYs tend to stop renewable projects (like the efforts that stalled Cape Wind for so long here in Massachusetts). They don't tend to stop fossil-fuel extraction, as we've seen from fracking in the US. The reason being that the money is to be made from fossil fuels and eventually people's greed wins out.

[americandream]

UK socialist?

[davep]

UK socialist?

It was a rather odd remark. Maybe healthcare that's free at the point of delivery means the UK is socialist. Who knows?

The City is the least regulated financial market on the planet, but I guess that's all part of the socialist agenda too.

[Keith_McClary]

Ownership of oil and gas within the land area of Great Britain was vested in the Crown by the Petroleum (Production) Act 1934. The Continental Shelf Act 1964 applied the provisions of the 1934 Act to the UKCS outside territorial waters.
For landward exploration a licence is required, which grants exclusive rights to exploit for and develop oil and gas onshore within Great Britain. The rights granted by landward licences do not include any rights of access, and the licensees must also obtain any consent under current legislation, including planning permissions.

https://www.bgs.ac.uk/mineralsuk/planni ... rship.html

[ROCKMAN]

"The rights granted by landward licences do not include any rights of access, and the licensees must also obtain any consent under current legislation, including planning permissions.: A well designed process: the folks who will be the most negatively impacted get no direct benefit of the production and can also veto the projects.

[frankthetank]

Bulldoze a few square miles, put up some rigs, get some sand and start fracking... drill drill drill.. we need every last drop. Grandma needs to drive to her mailbox.

[DesuMaiden]

100 billion barrels of oil sounds like a lot of oil, but it really isn't that much oil because we use about 30 to 33 billion barrels of oil every year. So 100 billion barrels of oil really only lasts about 3 years. So a large discovery like this really just delays the inevitable by a few more years. It gives people are peak oil informed a few extra years to prepare for to collapse of industrial civilization if they haven't already prepared for it. But no amount of extra oil that will ever be discovered will really delay peak oil by more than 5 to 10 years at most. The collapse of human industrial civilization is a pretty much a given and inevitable. Large oil discoveries, like this, really just delay the inevitable.

The death of around 90% of the human population is still pretty much an almost inevitable outcome of peak oil. No amount of wishful thinking and human technology can change this.

[dolanbaker]

Out of that 100billion, it is expected that only 15% or so may be extracted and that there are numerous hurdles to go over first. Cost being the biggest issue as this area has the highest land values in the UK and many of the landowners/residents are quite wealthy & conservative and as such are likely to be anti-fracking, not for environmental reasons but simply NIMBY because the view will be spoilt.

Multiple drilling pads of the type in the US simply won't be tolerated, well not until the choice is frack or freeze and that's decades away.

[americandream]

UK socialist?

It was a rather odd remark. Maybe healthcare that's free at the point of delivery means the UK is socialist. Who knows?

The City is the least regulated financial market on the planet, but I guess that's all part of the socialist agenda too.

[ROCKMAN]

Donlan - I'm sure when the truly serious pain of PO eventually kicks in the govt will suspend private rights just as they did during WW II for the "common good". And any viable oil/NG/coal resources will be developed. Self-preservation will demand it.

[dolanbaker]

Donlan - I'm sure when the truly serious pain of PO eventually kicks in the govt will suspend private rights just as they did during WW II for the "common good". And any viable oil/NG/coal resources will be developed. Self-preservation will demand it.

Exactly, most of the NIMBYs will go quiet when the stark choice is put in front of them, in fact I expect that they will be the first to say "drill FFS drill!"

One thing is for certain, because the effort required to extract is much greater and considerably more expensive than much of the stuff that is currently extracted. It is likely that greater effort will be put in increasing the utility value of oil, such that frivolous uses will be more and more discouraged.

Or put it another way, price rationing will eventually mean that only the well off will be major consumers of oil outside of the essential services including agriculture.

Increased use of alternatives and changes in the social fabric will prevent "oil cold turkey" syndrome.