Major Debacle wrote:
All this clamoring to open ANWR and off-limits
offshore areas to drilling is nothing more than
a grab for more free oil before Bush leaves
office.
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Lawmakers lay into big oil for leaving million
of acres untouched while at the same time asking
to drill in Alaska and off the coasts.
When I visited a friend and previous co-worker in
Anchorage several years ago, I visited with his
neighbor across the street who is a Development
Geologist with British Petroleum (BP). He said BP
has a LOT of reserves in already discovered
fields up there that are not now being developed.
Look at it this way. If BP or ANY company drills
a discovery well in a new wildcat area and then
drills confirmation wells to delineate the
reservoir, they can then use those in ground
reserves the same as MONEY IN THE BANK. They can
use these reserves to calculate the value of the
company, to borrow money on etc etc. It only
makes sense (business sense) to want to go out
and drill new areas and "Book Reserves". They
don't have to PRODUCE those reserves to add value
to the company.
NEW YORK (CNNMoney.com) -- Oil companies and
many lawmakers are pressing to open up more U.S.
areas for drilling. But the industry is drilling
on just a fraction of areas it already has
access to.
To be perfectly fair here, (I spent most of my
professional career as a Petroleum Geologist);
when companies bid on an offshore lease block,
for example, they have to take the entire block.
They an not able to "cherry pick" ONLY or choose
that portion of the block that is productive.
Yes, there is a huge amount of acreage under lease
undrilled BUT that is because most of the lease
block may not be productive. There is no law
saying that companies must purposely drill dry
dry holes on the remaining acreage in a lease
block.
Of the 90 million offshore acres the industry
has leases to, mostly in the Gulf of Mexico, it
is estimated that upwards of 70 million are not
producing oil, according to both Democrats and
oil-industry sources.
One Democrat staffer said if all these existing
areas were being drilled, U.S. oil production
could be boosted by nearly 5 million barrels a
day, although the oil industry said that number
is far too high and one government agency said
it was impossible to estimate production.
The problem is that MOST people do not have ANY
idea or concept of oil and gas exploration and
development - except for the ones doing it. The
ignorance I see expressed every day on TV is mind
boggling.
"Big Oil is more interested in pumping up prices
and pumping up their own profits rather than
pumping more oil," said Rep. Edward Markey
(D-Mass), who has co-sponsored a bill to charge
oil companies a fee for land they hold that's
not producing oil. "We should not even begin
discussing handing over more public land to the
oil companies until they first use [the land]
they already hold."
There are NO laws stating How or in what time
frame fields must be developed. In all fairness,
over development and producing too rapidly can
damage some reservoirs.
For example, if you develop too rapidly you can
deplete your reservoir(s) of the gas caps which
help keep the oil reservoirs pressured up and
produce the oil.
If you produce oil wells too rapidly you can also
"Cone" formation water that is on the edge of the
reservoir to the well bore and shut off oil flow.
It is very difficult if not impossible to restore
production of a well in such a case.
I have heard that a LOT of the Iraqi production
has faced this problem because Saddam was trying
for maximmum possible production to pay for his
war with Iran. A lot of the wells in Iraq will
have to be re-drilled or replacement wells
drilled. This is also something that never makes
the press.
It is a FAR more complex subject than the talking
heads lead us to believe.
more...
http://money.cnn.com/2008/06/23/news/economy/oil_drilling/index.htm?cnn=yes
