This teaching guide is designed to complement the 20-minute video, Crude Energy.  Click here to request the video.  Please note that video supplies are limited and may no longer be available.

Most of the money spent by the petroleum industry in exploring for oil is used for geophysics (the physics of the earth, including seismology, gravity and magnetics, among others). Geophysics provides techniques for imaging the subsurface (seeing below the ground) before drilling, and this can be key in avoiding “dry holes.”

Not realized by the general public is that most of the holes drilled are dry and do not yield commercial oil or gas. Locating an oil and gas reservoir (a place where a great amount of oil and gas has collected) and drilling oil and gas wells is very expensive (offshore wells can cost $15 million or more; in fact, some offshore platforms cost more than $4 billion). That’s why it is so important to utilize state-of-the art exploration and production technologies to keep costs as low as possible.

ConocoPhillips, for example, deploys one of the world’s largest and fastest supercomputers, a Cray T3D/1350 system, to process seismic data and to produce accurate images that identify the best location and trajectory for drilling wells.

In complex regions like the North Sea and Gulf of Mexico, advanced 3-D seismic imaging (producing an image in three dimensions–width, length and depth–of an area beneath the earth’s surface or ocean floor) has played a key role in locating wells and in reducing finding and development costs. With the aid of its supercomputer, ConocoPhillips has overcome some of the world’s most difficult seismic and engineering challenges in hostile environments.

Geoscience and Reservoir Technology
Oil companies realize the importance of research and development, commonly referred to as R&D. A significant part of ConocoPhillips’ Corporate Technology/R&D Division, for example, is the Geoscience and Reservoir Technology Group, an organization that includes expertise in geophysical, geological and petrophysical areas and drilling engineering, reservoir engineering, improved oil recovery technology (IOR) and production engineering. This group also manages the use of the Cray T3D/1350 supercomputer system for advanced seismic and reservoir engineering applications.

Science at Work
Some of the greatest oil and gas discoveries of the last decade have taken place above ground, or as the late Wallace Pratt, renowned petroleum geologist, phrased it many years ago, “Oil is found in the laboratories, computers and team meetings of scientists, engineers and field personnel.”

Technology plays a critical role in finding, developing and producing hydrocarbon (oil and gas) reserves. Technology enables oil companies to identify eventual drilling targets that would be missed using standard exploration techniques; reduce the risk of drilling a dry hole; complete drilling projects faster, which reduces costs; reduce costs by knowing which production equipment is best suited for use in a drilling area; and get the most oil and gas (improve recovery) from a new or formerly drilled oil and gas well by combining the efforts of geoscientists, engineers and scientists.

Geoscientists continually work to develop new ways to combine and use data from diverse sources in order to form a highly accurate picture of an area’s subsurface geology. The results are new discoveries, improved recovery rates, faster development and greater efficiency.

Identifying Opportunities
When considering an area for drilling, oil companies typically begin by collecting and analyzing geologic, production and commercial data on an entire geological basin, a likely place for oil and gas to have collected over millions of years. This often includes satellite photographs, gravity and magnetic information, plus existing 2-D seismic data (data showing the width and length of a subsurface area).

From this information, a basin model is formed to help assess potential. If it shows promise, the company conducts a seismic program that includes 2-D or 3-D data. If oil and gas are discovered, additional technologies help determine the best plan for utilizing the reservoir. The technologies indicate the most likely ways to get long-term production and financial returns.

Then, let the drilling begin!

Sources
“FAQs.” Explore Australia’s Petroleum Industry. Petroleum Industry Education. 2000. 
Identifying Opportunities. Accelerating Development. Maximizing Returns. Phillips Petroleum Company, Exploration & Production. 1995.
Optimizing Production. Improving Recovery. Enhancing Profitability, Phillips Petroleum Company, Exploration & Production. 1996.
Reducing Cost. Increasing Flexibility. Speeding Development. Phillips Petroleum Company, Global Gas/Exploration & Production. 1995.

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Last Updated: 02/16/03
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