Select Page

Oil and Gas
University of Illinois School of Law
Trott, Thomas George

Tom Trott for Oil & Gas I in Fall 2013

Chptr 1: History, Accumulation & Ownership

Saturday, August 24, 2013

4:49 PM

Historical Background

· (3) whale oil operated under the law of capture: a whale belonged to the whalers who could capture it & reduce it to possession

· kerosene distilled from coal less expensive but smokier than spermaceti (whale) oil

· “rock oil” developed into suitable illuminating & lubricating oil

barrels – standardized at 42 gallons

· outgrowth of real property law

Physical Background

· (4) wildcat well – exploratory well drilled in an area & into a formation that is not known to contain petroleum

o wildcatter – person who drills wildcat wells in search of petroleum

· petroleum geology – scientific search for traps that may contain oil & gas

(5) in times before drilling, oil had been recovered from surface seeps & pools

· gas, often found w/ the oil, and called associated gas, was at 1st considered a dangerous nuisance that was vented or flared at the drill site

o 1990s: valuable liquid called natural gasoline could be separated from the gas & marketed along w/ crude oil

o advances that made natural gas production viable:

· development of high-tensile steel, advanced welding, & pipe-rolling techniques in the 1920s

· nationwide natural gas delivery system

· extraction & marketing of a host of natural gas liquids (NGLs) from “wet” gas streams

Origin of Oil & Gas

Thursday, August 29, 2013

7:17 PM

Origin of Oil & Gas

Deposition

· typically marine deposit in diff rock layers

1. (5) deposit of organic material in shallow & tropical to subtropical water tens of millions of yrs ago

a. movement & collision of continents as described by plate tectonics conspired to placed N. America near the equator & under warm/shallow marine & lacustrine (lake & lagoonal) waters

b. (6) great quantities of marine plant + animal life thrived

2. accumulation began to undergo decomposition/degradation, or both

3. great tropical waters flowed forth, carrying mud, silt, and sand

4. progressive burial & resultant overburden began to provide significant pressure & higher temps around the buried organic matter

a. diagenesis:

i. process of organic material first subjected to heightened temperatures & pressures caused by burial under the 1st several hundred feet of overlying sediments

ii. compaction & passage of time, water is squeezed out of the organic material, and other chemical reactions leave a sticky reside called kerogen and a black tar-like bitumen

Generation

· catagenesis begins: thermal degradation of the kerogen to form hydrocarbons

o 3 key ingredients: time, heat, & pressure

· oil forming window represents a range of time, heat, & pressure necessary to form oil

o natural gas avenue: temperature + pressure > those found w/in the oil formation window, more complete cracking of the kerogen occurs, resulting in the formation of natural gas

o predominate theory: hydrocarbons produced from biological material altered over millions of yrs by heat + pressure

o alternative theory: hydrocarbons, gas in particular, can be generated in the absence of biological organisms at depths of 100-300 kilometers

Migration & Trapping

· (7) migration path is a pathway of rock or unconsolidated sediment w/ enough permeability to allow gas + oil to pass through along a multitude of small interconnected pathways, commonly known as pore spaces

o upward/lateral migration continues until the surface is reached or the gas venting into the atmosphere & oil pooling on the surface, or an impermeable barrier of rock is encountered, halting & trapping the migration

o hydrocarbon migration also affected by the hydrocarbon’s viscosity

· geologic trap is comprised of rock impermeable to flow (i.e. shale/salt)

Accumulation & Occurrence

Thursday, August 29, 2013

7:17 PM

Accumulation & Occurrence

· trap required, to stop the migration of oil & gas and hold it in place

o typically, below oil & gas is water (salt water mostly, needing remediation)

· salt water deposal well: pump it back where it originating

· dumping: traditional disposal

· pump it down the annulus: down the side of the well

· (7-8) reservoir is the volume of rock in which the hydrocarbons stay after the trap stops their progress, composed of 1+ traps

o subsurface rock boy w/ sufficient void space (porosity) to store hydrocarbons & connectivity b/t those void spaces (permeability) to allow hydrocarbons to flow

· reservoir geomorphology:

o commonly sedimentary, mostly comprised of grains of other rocks that have been eroded & transported by water/wind, and therefore more porous than most igneous & metamorphic rocks

· igneous & metamorphic rocks form under temp conditions that hydrocarbons cannot be preserved

· most common hydrocarbon contained rock = sandstone (porous & permeable limestone & dolomite rock follow)

o (9) saltwater presence w/in oil + gas accumulation causes wells to produce saltwater as well as oil + gas

o one way of classifying reservoirs is to group them according to their geologic source + geometry:

· structural category:

§ formed by stresses that cause deformation of the sedimentary rocks comprising the trap + reservoir

§ can form folds & faults

§ upward & lateral salt movements can form salt domes that can produce traps in overlying & adjacent sedimentary formations

§ types:

· folds & domes:

· folding subsurface rock formations (strata) usually having the shape of structural domes or upward-bent folds, or both

· elongated fold in the rock (anticline) may not provide closure adequate to act as a trap

· (10) faults:

· fracture/discontinuity in a volume of rock: sig displacement relative to the other side

· movement of rock juxtaposing an impervious rock layer over a reservoir rock could act as a trap

· typically trapping the gas but at diff depts

· (11) salt & over-pressured shale:

· subject to plastic flow over short periods of geologic time

· salt maintains a constant buoyant density as it is buried by overlying sediments

· plastic flow + buoyance = buried salt eventually pushing up through overlying sediments & flow towards the surface to form a complex structure of domes & salt walls w/ salt withdrawal basins in between

· (12) salt & shale do not normally contain recoverable hydrocarbons, but oil & gas commonly found in the sandstone formations abutting salt domes & over-pressured shale

· great for gas storage

· stratigraphic category:

§ (12) change w/in the formation itself providing the trap + reservoir

§ do not rely primarily on geological structures, thus more subtle & difficult for petroleum geologists to detect & image

§ types:

· channel sandstones/turbidites:

· most common

· sandstone/limestone sealed superior by changes in permeability or interlayering of it w/ impervious shale/mudstone

· hydrocarbons confined w/in porous & permeable parts of the ro

osed to surface conditions, such as at oil seeps

· biological degradation by bacteria results in oil that is tar-like or asphaltic

· production requires significant volumes of water and, when surface mined, results in substantial surface destruction, requiring extensive reclamation

· 1 pipe: heats oil

· pipe 2: collects & transports oil

o gas hydrates

· slush-like solids comprised of methane & water frozen in various combinations

· (21) techniques for economic development & subsequent marketing of hydrates elusive

Types of Reservoir Drives

Thursday, August 29, 2013

8:28 PM

Types of Reservoir Drives

· (21) oil + gas pushed out of the reservoir & up the well by pore pressure provided from the very same oil, gas, and water under high pressure in the reservoir

· developer hopes that internal reservoir pressure will itself drive oil + gas to the surface

o on pump

· compressor installed to assist in lifting the gas & pushing it into a gathering line system at the surface

o natural drives (reservoir-drive mechanisms)

· overburden pressure

· gas drive

§ reservoir has an internal pressure > bubble point, pressure at which gas can be contained in the oil solution w/o separating

§ gas separates out of the liquid hydrocarbon & rises b/c of its lower density

§ gas-only gas cap formed (25-50% recovery rate)

§ BEST APPROACH: drill first at the reservoir flanks to encounter the lower oil interval, reducing intra-reservoir pressure and allows the gas cap to expand & help push the remaining oil into the wells

· if no separate gas cap exists & gas is expanding in the oil itself, a solution-gas drive reservoir: typically small, compartmentalized, or otherwise laterally discontinuous so that the reservoirs are essentially closed systems (10-25% recover rate)

· water drive

§ (23) depends on release of reservoir pressure & the resultant expansion of the compressed water to provide the drive to force the hydrocarbons out of the reservoir & into wellbore over a broad front

§ particularly effective in producing hydrocarbons from porous & permeable reservoirs that are continuous over a large area

§ generally the most efficient type of drive for oil production (30-50% recovery rate)

· combination drive

§ solution drive: water is contained within the substance

· retrograde gas reservoir (gas-condensate reservoir)

§ portion of the gas converts to liquid as the gas approaches the surface

· dramatic drop in pressure + temp

§ flashing is the term for gas condensation

§ tend to be deeper & have higher pressure/temps than conventional reservoirs

§ gaseous condensate initially remains a vapor but as pressure drops, liquid drops out of gas while still in the reservoir (condensate drops = more difficult to produce & also inhibits flow through the reservoir rock)