OILympics: Golden Moments in O&G Development

OILympics: Golden Moments in O&G Development

As the 2012 Olympic Games wind down this weekend in London, Rigzone looks back at the 'golden moments' in technological development in the oil and gas industry that has allowed the industry to break new boundaries in exploration and production.

The race to find and produce additional oil and gas resources has become more technologically challenging in recent years, as the world's remaining oil and gas reserves have either been in remote areas or not accessible with exploration and production technology available at the time.

As a result, the industry is pushing the frontiers of exploration and production in challenging downhole and surface environments, deepwater, high pressure and temperatures, and drilling in environments such as the Arctic.

In the spirit of Olympic achievement, Rigzone celebrates five golden moments in the oil and gas industry:

George Mitchell and the Shale Boom

The U.S. shale boom is a tale not only of technology, but the perseverance of George Mitchell, founder of Mitchell Energy. Mitchell was the first to figure out the right combination of technology to successfully exploit the shale natural gas resources of the Barnett shale.

While Mitchell Energy had been drilling for natural gas in the Barnett field in North Texas, Mitchell became concerned in the late 1970s about future gas production. Mitchell then decided to try fracturing the Barnett formation. It took experimentation with mixes of fracking fluids.

Mitchell's ultimate success resulted in the U.S. shale gas boom, turning the nation from a destination for liquefied natural gas (LNG) imports to an LNG exporter. The ample supply of shale gas now available has spurred a renaissance in the nation's petrochemical chemistry and offers an alternative fuel solution. The U.S. shale boom has also resulted in shale gas exploration efforts worldwide.

Floating LNG Technology

Shell's plan to develop the Prelude and Concerto natural gas fields offshore the northwest coast of Western Australia involves building and mooring offshore what will likely be the world's first floating LNG (FLNG) facility.

The Prelude LNG facility will provide market access to Australia's estimated 140 trillion cubic feet of 'stranded' natural gas assets. These resources would be considered uneconomic for development via an onshore plant because they are too small or remote.

The Prelude FLNG facility – which will be 1,601 feet long and 242 feet wide and weigh around 600,000 tonnes, about six times as much as the world's largest aircraft carrier – will be moored in 820 feet of water for 25 years. Shell anticipates the facility will produce at least 3.6 million tones of LNG per year as well as liquid petroleum gas and condensate for export.

Lula and Brazil's Pre-Salt Reserves

The discovery of Brazil's Tupi field in the Santos Basin – later renamed Lula after popular president Luiz Inacio Lula da Silva, is not only one of oil's most "golden" moments, but also a "passport to the future" for Brazil, as current President Dilma Rousseff said.

"As Brazil's first major pre-salt discovery and the largest oil discovery in the Western Hemisphere in three decades, the lessons learned here will help the country to develop a huge network of pre-salt fields clustered between the Campos and Santos Basins, which are estimated to hold between 50 billion and 100 billion barrels of oil," said Peter Silva, global media analyst at BrightWire.

Pilot production activity began at the Lula and Guara fields in 2010 and 2011, according to a February 2012 report by the U.S. Energy Information Administration. While the potential impact of the discoveries is vast, industry faces challenges in accessing reserves and in the scale of the proposed expansion production. Successfully meeting these challenges would definitely be considered a golden moment for the oil and gas industry.

Independence Hub

The $2 billion Independence Hub project, which began production in 2007, pushed the boundaries in technological and operational achievement when it was developed to produce natural gas from the ultra-deepwater eastern Gulf. The facility can process up to 1 billion cubic feet of natural gas production from 10 anchor fields, with excess payload capacity to tie back up to nine additional subsea flowlines.

The oil and gas industry's successful development of deepwater Gulf of Mexico fields in recent years as a whole can be classified as a golden moment for oil and gas as advances in deepwater production infrastructure allow access to the deepwater Gulf's oil and gas reserves.

The roster of deepwater Gulf fields under development in recent years includes Atlantis, Na Kika, Perdido, Jack/St. Malo. These fields are examples of advanced field development technology, including moored semisubmersible platforms and production spars, which have allowed the industry to set records. Shell set a record for the world's deepest subsea well in November 2011 when it began producing oil from the Perdido development.

The oil and gas industry continues to add new production from the deepwater Gulf. In June, BP reported it had commenced production from the Isabela, Santiago and Santa Cruz fields – part of the Galapagos deepwater Gulf development. The fields will be connected to the Na Kika host platform.

IT Software

The oil and gas industry in a relatively short time has seen incredible milestones thanks to advances in IT – particularly software – and the ability to access and analyze data in new ways, from new sources, said Gene Minnich, vice president of Landmark Software and Services.

"Before Landmark launched the first interactive workstation for seismic interpretation in 1984, we were a pencil and paper industry reliant on flat visual interpretation," Minnich commented. "With this breakthrough, engineers got their first taste of 3D data analysis and visualization through machines."

This would spur a chain of milestones, including development of the first commercial rig site morning reporting system in 1986 by Munro Engineering, which was acquired by Landmark in 1994.

"While the ability transmit data from rig to office seems like an 'of-course' for today, using VHF "push-to-talk" radios was revolutionary at the time," Minnich said. "What's more exciting is that I think we've barely tapped the surface of the types of data we can explore, the places we can reach into, and the methods through which we can access it."

"With tablets, mobile phones and cloud technology still maturing in O&G – I think there are several golden moments in store in the next five years," Minnich added.

Technology Torchbearers

The oil and gas industry has been thinking outside the box in recent years, seeking to apply technologies used in other industries to enhance production and reduce cost.

Nanotechnology, the study of manipulating matter on an atomic or molecular scale and developing materials, devices or structures possessing nanomaterials, has been used in the medical, aerospace and textile industries, is now being applied to the oil and gas industry.

While efforts are underway to access new oil and gas resources have been underway for some time, the oil and gas industry also has been seeking ways to enhance oil recovery. One recent example of technological innovation to enhance oil recovery is a new process that uses antenna heat to enhance oil sands recovery.

Oil and gas operators worldwide are increasingly turning to technology to better monitor and enhance hydrocarbons recovery, including swellable packers with elastomers.

The use of radio-frequency identification (RFID) technology, in which radio waves are used to transfer data from an electronic tag, attached to an object through a reader to identify and track an object – also is beginning to grow. While it has been primarily used to track inventory, RFID also is being deployed in drilling.

As we look back and celebrate the athletic achievements of participants in the 2012 Summer Games, we can also take stock of the achievements made by the oil and gas industry. And we can guarantee that the industry will continue to surpass new frontiers in exploration and production as the race to find new oil and gas resources continues.

Chevron Sells Wheatstone LNG Project Interests to Pan Pacific Energy

Karen Boman has more than 10 years of experience covering the upstream oil and gas sector. Email Karen at kboman@rigzone.com


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