Back to the well: Bypassed oil beckons

Petrobras, the Brazilian oil company, announced a couple of weeks ago the discovery of a huge offshore oil field – described as the second-biggest discovery of conventional crude anywhere in the world in the past 20 years.

Oddly enough, though, the biggest discovery of conventional oil this year went largely ignored – notwithstanding the fact that it took place in the continental U.S., where such things are not supposed to happen.
The U.S. National Energy Technology Laboratory (NETL) made the relevant announcement earlier this year as follows: “Researchers at Texas A&M [University] and the Department of Energy have produced a new computer tool that will increase recovery of as much as 218 billion barrels of bypassed oil remaining in mature domestic fields.”

Two hundred and eighteen billion barrels of conventional oil. Note that this is almost 10 times the proven reserves (22 billion barrels) of the United States. Note that this is enough to run the U.S. economy for the next 25 years. And note that this isn’t a reference to all the oil left behind when wells ran “dry” – a resource that exceeds 300 billion barrels. This is a measure of the “bypassed oil” that, with advances in technology, can now be deemed recoverable. At $100 (U.S.) a barrel, it would be worth more than $20-trillion. And it’s all sitting there, in known places, in old oil wells – hundreds of thousands of them – that are now regarded, for all practical purposes, as empty holes in the ground.

NETL, operating from six research campuses across the U.S., is the only government-owned research laboratory that works exclusively on fossil-fuel technology. It funds research into EOR – “enhanced oil recovery” – for a number of reasons. One is simply the vast amounts of oil that have been left behind. (“More than two-thirds of all the oil ever discovered in America,” it says, “remains in the ground.”) Another is that the vast majority of “depleted” wells are too small to interest the big oil companies.

NETL develops technology to help small, independent companies pursue this abandoned oil. More than 7,000 of these companies are already pumping oil from depleted – to say nothing of deleted – wells: “Much bypassed oil lies in difficult-to-access pockets,” NETL says. “Predicting the size and locations of these elusive deposits is costly.” So the lab financed the development of sophisticated software that will guide these oil-salvage companies in the hunt. Along with computer-driven mapping, the lab has developed “tracer tests” – using coloured liquids and gases to track pathways within a well. Were each of these entrepreneurial outfits to recover 200 barrels a day, the U.S. would gain more oil than it imports from Canada.

Globe and Mail