Geology News - Earth Science Current Events

Map of the Oil Shale Basins in Colorado, Wyoming and Utah.

The Bureau of Land Management issued leases for five oil shale research projects. These are the first federal oil shale leases issued in over thirty years. Increasing demand for energy and increasing oil prices have spurred a renewal of interest in oil shale.

Oil shale is a rock that is rich in an organic material known as kerogen. If it is heated in the absence of air the kerogen will yield liquid oil. The Green River Formation, which underlies large portions of Wyoming, Utah and Colorado contains the world’s largest oil shale resource. According to BLM this deposit could contain over 800 billion barrels of recoverable oil - more equivalent oil than the Middle East. However, this resource has not been developed because the cost of extracting oil from the shale has historically been too high.

Oil Shale - Image by US DOE.

Recent increases in oil prices and demand have spurred a renewed interest in oil shale research. These new BLM leases grant rights to develop the oil shale on 160-acre tracts for a period of ten years. The leases can be extended in time and expanded to up to 5000 acres if specific commercial production levels have been met.

There are two different approaches to extracting oil from the shale. One process involves mining the shale, crushing it and running it through a heat treatment process. The other heats the shale while it is still in the ground and produces the oil through wells. This in-situ conversion is currently favored by many industry experts. Challenges which accompany the development of an oil shale resource include: greenhouse gas emissions, mined land reclamation, disposal of spent shale, and water use.

An interesting article: The Cautious U.S. Boom in Oil Shale can be found at the New York Times website.

Labels: Fossil-Fuels, Global-Warming, Minerals

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Map of the Appalachian Basin

The Appalachian Basin has a longer drilling history for oil and natural gas than any other basin on this planet. In 1815, Captain James Wilson accidentally struck natural gas while drilling for salt near Charleston, West Virginia. Then as early as the 1820’s oil produced from West Virginia wells was used for illumination and as a lubricant. Profit from similar accidental discoveries fueled the intentional drilling for oil and natural gas.

A few hundred thousand wells later Richard Beardsley, winner of the AAPG Explorer’s Award called the Appalachian Basin “The Most Drilled and Least Explored” basin in the world. Beardsley speaks this way because most Appalachian Basin discoveries were made in shallow wells, drilled on easy exploration models such as anticlines, or focused on small flow developmental wells that were suitable for local refining or gas utilities.

Today, high energy prices, improved drilling technology and advances in seismic imaging are converging to stimulate some real exploration. Within the past few years some of the highest yield gas wells in the eastern United States have been deep wells drilled in the Finger Lakes Region of New York and in Tioga County, Pennsylvania. These areas are also very close to the high demand east coast market and have an enormous transportation advantage over gas produced on the Gulf Coast or in the Rockies.

An article in the Pittsburgh Post-Gazette describes some of the recent exploration activity in the northern Appalachian Basin.

Labels: Fossil-Fuels

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Chevron today announced a major oil discovery from the Jack #2 well at Walker Ridge Block 758 in the U.S. Gulf of Mexico, approximately 275 miles southwest of New Orleans. There in over 7000 feet of water they drilled a test well to a depth of 28,175 feet below sea level. The well flowed at a rate of 6000 barrels per day from an area that Chevron estimates could contain between 3 billion and 15 billion barrels.

In addition to striking oil Chevron set several drilling records. World records for test equipment pressure, depth and duration in deepwater were broken. It was also the deepest well ever drilled in the Gulf of Mexico. Chevron is the operator of the well with a 50% interest. Other participants are Statoil (a Norwegian company - 25%) and Devon Energy (a North American independent oil and gas producer - 25%).

Developing this deep resource will take additional investments of billions of dollars and at least two years of work. A second test well is planned for drilling in 2007.

Read Chevron's press release about the Jack #2 well at their website.

Labels: Fossil-Fuels

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North Slope areas in the NPR sale

The Bureau of Land Management is in the process of a National Petroleum Reserve lease sale for thousands of acres on the Alaska North Slope. The sale involves land in the Teshekpuk Lake area, bounded by the Colville River in the south, Point Franklin in the west to Harrison Bay in the east.

Millions of barrels of oil and large volumes of natural gas are believed to be beneath these areas. The bidding process is underway and winners will be announced in September. Oil companies are eager to obtain land in this sale but environmentalists want to limit access to the land because of concerns for wildlife and the sensitive environment.

The National Petroleum Reserve - Alaska is a 22 million acre area that was designated for oil and natural gas leasing in 1923 by the United States government. BLM is trying to balance environmental concerns and energy development needs by restricting areas that can be used for roads and drilling.


Portion of a Preliminary Lease Map from BLM
Image Copyright Geology.com and Map Resources.
Read more and view .pdf images of the Alaska Oil Lease Maps at the Bureau of Land Management website.

Labels: Fossil-Fuels

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Image by Bureau of Land Management

ConocoPhillips has declared force majeure as a result of pipeline problems that have partially shut down the Prudhoe Bay oil field. (Force majeure is a clause in many contracts that frees a company from liability when an extreme event beyond their control prevents them from fulfilling the obligations of that contract.)

Conoco, a major stakeholder of Prudhoe Bay oil production, has notified west coast refineries that crude will not be delivered and that the Prudhoe oil can not be replaced with oil from another source.

Other key players in the Prudhoe Bay field are BP and Exxon. BP has acquired other sources of oil to meet obligations. Exxon maintains that it is premature to discuss force majeure on their contracts.

Read more about the Prudhoe Shutdown at MSN.

Labels: Fossil-Fuels

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Image by US Fish & Wildlife Service

The Prudehoe Bay Oil Field, which yields about 400,000 barrels of oil per day, will be partially shut down until the pipeline leak is repaired. The Prudehoe Bay field is owned by British Petroleum, ConocoPhilips and ExxonMobil and is responsible for about 8% of US domestic production.

Oil prices reacted to this news, and the continued instability of the Middle East, by rising to record levels of over $78 per barrel. Read more about the Prudehoe Bay Pipeline Failure at the BBC website.

Labels: Fossil-Fuels

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Offshore Drilling Platform at Night - NASA image

Oil prices danced at record levels last week, breaking $75 per barrel. Several factors are supporting these price levels: 1) demand for gasoline is very strong even with U.S. prices approaching $3 per gallon, 2) problems in Iraq and Nigeria limit production in those countries, 3) international tensions, and, 4) concerns for production related to a developing hurricane season.

At the same time that oil prices are breaking records, natural gas prices dropped to some of their lowest levels in two years. Large volumes of natural gas in storage are reducing demand for that commodity.

Labels: Fossil-Fuels

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Victoria University of Wellington, New Zealand and the Institute of Geological and Nuclear Sciences Limited will begin offering a Master of Science in Petroleum Geoscience starting in 2006. This course will be open to students worldwide.

The program will produce petroleum science professionals who have received hands-on training in the techniques used in oil and gas exploration. Experience with petroleum industry software and equipment will be strong elements of this program.

GNS Science Hydrocarbons Manager David Darby says, "The industry is recruiting aggressively and there are not enough skilled graduates to go around. This initiative will help to address this urgent problem. We have 30 world-class petroleum geoscientists from GNS and the petroleum industry contributing to the course. Very few universities would be able to draw on that level of petroleum expertise for a postgraduate course.”

Read more about this new Petroleum Geology Program at the GNS website.

Labels: Fossil-Fuels

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