free html hit counter Peak Oil Debunked: 263. ARE THE LARGEST FIELDS DISCOVERED FIRST?

Wednesday, March 15, 2006

263. ARE THE LARGEST FIELDS DISCOVERED FIRST?

A key assumption of the argument for imminent peak oil is the idea that "the largest fields are discovered first". If you quiz the peak oilers about it, they generally don't produce any supporting data. They simply appeal to "common sense".

Granted, the idea does seem reasonable on the face of it, but I distrust common sense. I prefer data, and the data shows that reality is more complicated.

For example, if the largest fields are discovered first, why did it take roughly 90 years after oil drilling began to find Ghawar (the world's largest field)? Similarly, Iran recently discovered 2 super-giant oil fields: Azadegan (2001) and Ferdows/Mound/Zagheh (2003). Azadegan was the largest field discovered in Iran in 30 years, and Ferdows is even larger. Oil exploration in Iran began in 1901. So why did it take 100 years to find these large fields if large fields are discovered first? Similarly, Kazakhstan discovered the gigantic Kashagan field (the country's largest field) in 2000, even though oil exploration in the area began prior to WWII. Prudhoe Bay, the largest field in the U.S., was discovered in 1968, even though Colonel Drake drilled the first U.S. well in 1859. Why did it take the U.S. 109 years to find its largest field? Norway recently discovered gargantuan coal deposits in the North Sea holding 3 times more coal than all the previously known coal resources in the rest of the earth's crust. It was the biggest coal discovery ever, and it happened more than 500 years after people began mining coal. That would seem to be a case of the largest deposit being found LAST.

Ronald R. Charpentier of the USGS has data making the same point in his presentation The Future of Petroleum: Optimism, Pessimism or Something Else(pdf) (click image to enlarge):
The disadvantages of trendology are easily demonstrated, however. Consider the discovery history of part of the Trias-Ghadames basin of Algeria. If trendology had been used for an assessment in 1980, the assessment would have given little chance for undiscovered fields larger than 10 million barrels and the resulting estimate would have been low. The largest field in the assessment unit would have been missed. (Slide #6)
As you can see in the chart, the largest field in this basin of Algeria was not discovered first. If the peak oilers had been in Algeria in 1980, they would have pointed to the declining trend and said the basin was all played out. They would have missed the largest field.

The same trend is continuing today. Just yesterday, Mexico announced the discovery of a new deepwater field potentially larger than Cantarell, their largest currently operating field*:
MAR. 13 5:52 P.M. ET Mexico has made a deep-water oil discovery in the Gulf of Mexico that could be larger than the country's giant Cantarell offshore field, President Vicente Fox said on Monday.Source
In short, the evidence shows that large fields are frequently discovered late in the game. It also shows that there are some serious problems with Matt Simmons' superficial fairy tales about kings, queens and lords:
The French Petroleum Institute did a major study a couple of decades ago about the distribution of oil fields by basin. And what they found was that what seems to happen with phenomenal regularity is that within about 5-7 years of moving into a new area of prospective hydrocarbon, you tend to find the queen first, which is the second largest field you're going to find. You then calibrate in on the knowledge of how you found that and within a handful of years you find the king. And then over the next decade, you find there too, the next 8-10 lords. And once you've found the royal family, the rest of everything you'll ever find are basically peons in size.Source
-----
*) Chicontepec, an undeveloped heavy oil field north east of Mexico City, is actually larger than Cantarell. Its original oil in place (OOIP) is greater than 139Gb, of which 7% to 10% (10-13Gb) are currently technically recoverable. (Source: World Oil, Nov. 2001)
-- by JD

19 Comments:

At Wednesday, March 15, 2006 at 1:04:00 PM PST, Blogger Dom said...

Actually, the theory is not that the largest fields will be found first (as maybe a Simmons would translate it), but that the closest, most easy to exploit fields will be found and exploited first. In Hubbert-Speak, that means feet drilled per well will generally increase (it has) and number of wells drilled per positive find will increase (it has).

The first oil well was in Pennsylvania. I grew up in Ohio, home of the Rochefellers, where oil production peaked in 1893. Our region boomed oil around 1912 (after peak!). Don't worry, we can still drill and find oil where I grew up. It's just riskier and not really profitable even at today's higher prices.

But the real finds got farther and farther away, deaper and more difficult to get to. Or the oil is of much inferior quality (see Venezuela and the huge quantities of oil in Mexico you mentioned). Why not exploit the oil sands, if you can't find enough light crude which is easy to find and refine? Right now you have to go into deep sea or artic regions to get to it. That's why it will take ten years to begin exploiting Mexico's new finds. Long past peak.

By the way, drilling in Ohio at 900m takes about four weeks to production. Why can't the Mexicans do it that fast with their new monster field?!!

 
At Thursday, March 16, 2006 at 5:59:00 AM PST, Blogger bc said...

Actually, the theory is not that the largest fields will be found first (as maybe a Simmons would translate it), but that the closest, most easy to exploit fields will be found and exploited first.

I spent a long time hanging around a doomer site (which includes several petro-geologists), and whenever this topic came up, the explanation "the large oil fields have already been found; there are no more super-giants" was consistently repeated.

Even allowing for hyperbole, the clear assumption is that the large fields are found first. The nuance you describe I have never seen mentioned. Your theory may be the correct one, but it is never espoused by doomers.

What I have noticed is "what doomers said" is highly flexible, and is interpreted to mean different things depending on what little debate they are trying to win, or what contrary fact they are trying to explain away. Wnen all else fails, they will say "don't be silly, we never meant that! It was just hyperbole!"

 
At Thursday, March 16, 2006 at 7:25:00 AM PST, Blogger al fin said...

Good post. The largest fields are yet to be found--"long past peak" as they say. What does that mean when the largest fields are found and developed long past peak?

The easiest to find and cheapest to drill are not necessarily likely to be the largest. Like the drunk who looks for his keys under the streetlight even though he dropped them two blocks away--the light was better under the lamp.

 
At Thursday, March 16, 2006 at 9:15:00 AM PST, Blogger Sumyung Guy said...

JD, I think that you've already presented good evidence on this blog that Peak Oil doomer scenarios are off the mark, but I wonder what you think of the consequences of burning all the oil that we still have left in the ground?

There's a lot of evidence out there (unless you're a scientist being paid by a grant from Exxon-Mobile) that global warming is real and that human-caused increases in atmospheric CO2 are making it worse.

I'm a moderate pro-tech guy who believes that there's a lot of technology out there right now that could allow the US and the rest of the world to reduce our CO2 output without reducing economic growth (indeed, many of the potential technologies could lead to lots of new jobs right here in the US of A), so I'm wondering if there's any technologies you've been keeping your eye on? What's your take on stuff like the latest wind-power generators, concentrating-solar power tech, nano-tech thin film PVCs, plug-in hybrid electric cars and the like?

 
At Thursday, March 16, 2006 at 12:54:00 PM PST, Blogger Roland said...

Chevron just sponsored a conference here in Sydney about global warming. Good old Chevron.

 
At Thursday, March 16, 2006 at 4:24:00 PM PST, Blogger JD said...

Hi SG, welcome to POD.

what you think of the consequences of burning all the oil that we still have left in the ground?

I think it's a really stupid idea. There's a lot of oil in the ground, but that doesn't mean we should burn it as fast as we can. That is why I'm a nasty critic of private automobiles and peak oiler/environmentalist hypocrites who drive. The "problem" of peak oil has nothing to do with oil, and everything to do with cars. Much of the peak oil community is focused on the wrong problem.

What's your take on stuff like the latest wind-power generators, concentrating-solar power tech, nano-tech thin film PVCs, plug-in hybrid electric cars and the like?

All those alternatives are good, and should be vigorously pursued. But I don't think they should be regarded as a way to painlessly continue the status quo. Step 1 of the solution to peak oil is conservation and efficiency. Gizmos are Step 2.

 
At Thursday, March 16, 2006 at 8:15:00 PM PST, Blogger DC said...

Much of the peak oil community is focused on the wrong problem.

Bingo. Furthermore, if the reality of the supply picture eludes them, then why should anyone put any stock into the gloom n' doom prognostications?

 
At Friday, March 17, 2006 at 11:07:00 PM PST, Blogger The Masked Lemming said...

jd i just watched CNN and the doomers got to them! the doomers are running wild! what are we going to do? what are we going to do? TML

 
At Saturday, March 18, 2006 at 2:10:00 AM PST, Blogger Dom said...

OH NO! THE DOOOMERS got out!
1) What if some of the doomer scenarios are right? Short of dieoff, of course.
2) Is it a bad thing that it takes doomers to let the public know that there is a problem? Maybe people will start to conserve/sell their car, change their lifestyles...

 
At Saturday, March 18, 2006 at 3:54:00 PM PST, Blogger Rick said...

Your proposition makes me anxious to go buy a really big gun and hunt for a woolly mammoth. Obviously there must be some out there somewhere

 
At Saturday, March 18, 2006 at 6:12:00 PM PST, Blogger DC said...

The CNN special was doing ok until about 7 minutes in when Matt Simmons popped up as an energy "expert." If he's an expert, then I'm royalty, baby. It's a shame they didn't throw Lovins a bone and that they didn't include anything beyond vague generalities from Woosley. Of course, that might have put a damper on the sensationalist bit they ran through the whole program (the 2009 hypothetical...and the only part to which I mildly objected).

It was ok. Nothing new: Woolseley's freaked, Simmons is clueless, China is oil hungry, the Tar Sands are no salvation, Brazil's ethanol industry kicks ass, and the US is still sleepwalking. If it gets people talking about energy issues, then it would have served some good. It didn't lean too heavily on the gloom n' doom stuff, so it's not an irresponsible, irrational call to arms.

 
At Sunday, March 19, 2006 at 1:37:00 AM PST, Blogger The Masked Lemming said...

thank god! but what about this oil crash movie, the doomers over at the oil drum and peakoil.com are going gaga over it like its their freakin cinematic savior. between this and the oil bourse the doomers are smelling blood! If this oil crash movie hits the theaters and gets big, the doomers are going to run over us like a herd of freaked out elephants trampling over grass and crapping all over it also. JD what are we going to do? what are we going to do!?

 
At Sunday, March 19, 2006 at 3:41:00 AM PST, Blogger half said...

Why ask Masked One? They's nothing we can do. We're doooooooomed to die in a final orgy of oil letting. It's in all the books and now the movies. Our only hope is if the 12th Pogue reappears.

 
At Sunday, March 19, 2006 at 4:47:00 AM PST, Blogger Rembrandt said...

I would refer to poster dom as regarding to the theory, not only about the largest, but about the easiest to exploit

"Azadegan was the largest field discovered in Iran in 30 years"

exactly, in 30 years, before that we saw four huge discoveries near 15 billion barrels. Rest was around 2 billion bbls

Gachsaran (1928)
Agha Jari (1936)
Ahwaz (1958)
Marun (1963)

Does the first large discovery in 2000 herald another twelve Azadegan's? The four large fields above are thrice the size of Azedegan...

Doesn't seem very likely, maybe one or two. Not twelve!

Ferdows is a field that will not be exploited in the near future and contains about 3 to 7 Gb of RECOVERABLE oil. Ill see what I can find about the field later

"As to Prudhoe bay.."

The field is in a region that is very hard to logistically work around. Since oil business is about economics (which JD often seems to forget) it isn't that smart to start drilling somewhere when you don't have the money/techniques to deliver oil from there.

In general oil field size discoveries in the U.S. have been dwindling Exponentially

"Since 1945, the number of oil fields in the intermediate size classes B, C, and D discovered per unit of search effort has been declining exponentially, just as it has for the class A giant gields. (the small class E fields appear to represent an expection to this rule since about 1955). Moreover, the rate of decline in the discovery of intermediate-size fields is a direct function of field size as predicted by the random-drilling model" Menard, Scientific American, 1981

Class B = 37 million barrels
Class C = 17 million barrels
Class D = 3 million barrels
Class E = 0.3 million barrels

"Chicontepec, an undeveloped heavy oil field north east of Mexico City, is actually larger than Cantarell. Its original oil in place (OOIP) is greater than 139Gb, of which 7% to 10% (10-13Gb) are currently technically recoverable"

Well well what's the discovery date than? earlier or later than Cantarell. By the way you can't really compare Cantarell and Chico (one is producing heavy other producing light/medium).

 
At Monday, March 20, 2006 at 4:35:00 AM PST, Blogger Dom said...

Thanks Rembrandt for more backround information. But JD is right. We just found the biggest oil field yet! After (on) Peak!

::.::.::.::.::.
(That's supposed to be a drum roll)

The Planet Titan!

Ok, you're right, we just keep making the oil-producing region bigger.

 
At Wednesday, June 6, 2007 at 2:47:00 AM PDT, Blogger Phillip said...

Who cares when the biggest feilds are found - the volume of oil discovery has been trending down for the last 40 years - that's the important point.

 
At Sunday, December 23, 2007 at 9:20:00 AM PST, Anonymous Anonymous said...

JD, your logic is lucking. Why would anyone go to drill in Alaska, when their was plenty of oil in Ohio and Kansas. You have to compare the same territory to make it a valid argument. Now, how soon was Prudhoe bay discovered, once Alaskan drilling started???

 
At Saturday, May 29, 2010 at 9:49:00 PM PDT, Blogger simon said...

Fact is, oil discovery in numbers of barrels per year peaked globally in the 1960s. We are currently finding 1 new barrel of oil for every 4 barrels we use. Oil companies are just not investing much money in discovery because they know that there isn't much left to be discovered. If they thought it was there they would be looking for it. Neither are they building any new refineries because they know they will not recoup their investment. They are also going for expensive and hard to retrieve reserves - see the current Gulf Of Mexico disaster because they know there is no more easy to find oil. If anyone knows about oil it is the oil companies. Every indication from them is that the doomers are correct.

Interesting fact: Oil demand is increasing by 5% per year. At that rate it will double in 14 years. That means we will need at much oil in the next 14 years AS WE HAVE USED IN THE ENTIRE HISTORY OF OIL USE. That is what the doubling of demand means. Then we woould need to double that again in the next 14 years.

There is absolutely not a chance in hell that we are going to be able to pump from existing wells and find in new wells enough oil in the next 14 years as we have used in the last 150. So the doomers are correct. As soon as demand exceeds supply the price is going to sky rocket and all the doomsday scenarios take place.

 
At Tuesday, March 27, 2012 at 1:37:00 PM PDT, Anonymous spermicelli said...

Simon's conclusion not self evident. A declining number of barrels does not by itself indicate there are less barrels discovered in the ground. In fact, past discoveries should discourage for a period future ones, since oil companies with finite resources are not prioritizing production, they prioritize maximizing the value of the barrels on the market. Its only when supply begins to outstrip demand at a calculated "sweet spot" that companies will haul out and look for more with urgency and serious resources. And even that is perhaps debatable, because who is to say that oil prices today will provide the best value of their known reserves as opposed to oil prices well down the road, when oil is really a scarce resource. Its a complicated dilemma for producers, especially producers licesned by a state which wants to keep production high and domestic prices low. A very large find in fact could predict a long delay in a follow up, until the demand in the market and the strategies or needs of or pressures on the company are right.

 

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