History of Oil Recovery:
(Excerpted from WikiPedia)  Source HERE
 
Ancient Times:
More than 4000 years ago, according to Herodotus and Diodorus Siculus, asphalt was used in the construction of the walls and towers of Babylon; there were oil pits near Ardericca (near Babylon), and a pitch spring on Zacynthus.  Great quantities of it were found on the banks of the river Issus, one of the tributaries of the Euphrates. Ancient Persian tablets indicate the medicinal and lighting uses of petroleum in the upper levels of their society. By 347 AD, oil was produced from bamboo-drilled wells in China.   Early British explorers to Myanmar documented a flourishing oil extraction industry based in Yenangyaung, that in 1795 had hundreds of hand-dug wells under production. The mythological origins of the oil fields at Yenangyaung, and its hereditary monopoly control by 24 families, indicate very ancient origins.
 
Modern Day:
In the 1840s, the process to distill kerosene from petroleum was invented by James Young in Scotland and the first refinery was built by Ignacy Łukasiewicz, providing a cheaper alternative to whale oil. The demand for petroleum as a fuel for lighting in North America and around the world quickly grew.  The question of what constituted the first commercial oil well is a difficult one to answer. Edwin Drake's 1859 well near Titusville, Pennsylvania, is popularly considered the first modern well. Drake's well is probably singled out because it was drilled, not dug; because it used a steam engine; because there was a company associated with it; and because it touched off a major boom.  However, there was considerable activity before Drake in various parts of the world in the mid-19th century. A group directed by Major Alexeyev of the Bakinskii Corps of Mining Engineers hand-drilled a well in the Baku region in 1848.  There were engine-drilled wells in West Virginia in the same year as Drake's well.  An early commercial well was hand dug in Poland in 1853, and another in nearby Romania in 1857. At around the same time the world's first, small, oil refinery was opened at Jasło in Poland, with a larger one opened at Ploiești in Romania shortly after.  Romania was the first country in the world to have had its annual crude oil output officially recorded in international statistics: 275 tonnes for 1857.
 
First Commercial Oil Wells in North America:
The first commercial oil well in Canada became operational in 1858 at Oil Springs, Ontario (then Canada West).  Businessman James Miller Williams dug several wells between 1855 and 1858 before discovering a rich reserve of oil four metres below ground.  Williams extracted 1.5 million litres of crude oil by 1860, refining much of it into kerosene lamp oil.  William's well became commercially viable a year before Drake's Pennsylvania operation and could be argued to be the first commercial oil well in North America.  The discovery at Oil Springs touched off an oil boom which brought hundreds of speculators and workers to the area. Advances in drilling continued into 1862 when local driller Shaw reached a depth of 62 metres using the spring-pole drilling method.  On January 16, 1862, after an explosion of natural gas Canada's first oil gusher came into production, shooting into the air at a recorded rate of 3,000 barrels per day.  By the end of the 19th century the Russian Empire, particularly the Branobel company in Azerbaijan, had taken the lead in production.
 
Surface vs Underground Methods:
In the beginning, Col Drake drilled a well at Titusville, PA to supply the new petroleum industry that needed oil to refine into kerosene for lamps – and people said he was crazy:
  • As more uses were found for oil and it’s products, new and better ways to explore and drill evolved
  • When oil was found under lakes and in the ocean, offshore drilling platforms were built
  • But drilling wells left lot's of the oil in the ground (often 80 or 90% was left behind),
  • So, the water flooding process and other methods of increasing pressure and sweeping the oil out of the rock were developed
  • And then they developed ways to turn (slant?) the drill bit, and horizontal drilling made it possible to recover oil in a new way
  • But some of the oil (and gas) was trapped in very tight rock, so hydraulic fracturing was added
  • The petroleum industry has continuously evolved to go deeper and recover oil and gas from more difficult conditions
 
Yet almost 2/3rd of the oil is still left stranded in the average reservoir, and many known oil fields still cannot be produced because they are located under surface areas where conditions are pristine...
 
Today's Modern Extraction Solutions:
Fortunately, a proven solution already exists to produce oil and gas from some of these stranded, challenging or environmentally prohibited deposits:
  • A method that uses existing technology, not new inventions
  • A method that is safe and reduces the environmental impact of development
  • And for select reservoirs, the costs are much lower than some of the practices being used today.
 
It's Called "Underground Drilling"
  • Underground Drilling uses the best and safest current surface oil production techniques and applies them in new and innovative ways in an underground working platform.
  • A DOE study identified 126 sites with 50 billion barrels of oil where this solution could be applied
  • And that study did not include heavy oil or offshore deposits
  • A study by a sub-committee of the American Society of Civil Engineers identified over 600 potential sites
  • And these two studies were done at an oil price of $18 per barrel
  • These are deposits in the United States that will create new jobs and economic prosperity, while reducing the need for imported oil
  • This process could recover literally trillions of dollars of oil that might not be produced by other methods
  • Could this be as big as development of the Bakken oil field in N. Dakota and Montana?
 
If it is so good, why isn't the industry using it?
1) Because it is different, and petroleum engineers and executives don't understand it
2) Because they don't want to be the first to use it, in case something goes wrong
3) Because it is not part of their core capabilities (competencies):
- They want a service firm to develop the technology,
- To demonstrate that it works,
- And then the oil firms will hire that service company to apply the technology to their oil fields
 
What is this “new” technology?
  • We call it Underground Oil Recovery (UOR)
  • Others have called it oil mining, Mine Assisted Petroleum Development (MAPD), and several other names have been suggested.
 
UOR uses underground drilling platforms that perform the same function as offshore platforms:
Drillers can get close to stranded, depleted, or challenging oil deposits so they can economically drill more holes into the reservoir rock, which allows more of the oil to be recovered.
Or the underground drilling platform can be located in rock underneath the sensitive areas so the surface environment is not disturbed – Any current drilling system can be used to drill from an underground platform.
 
The UOR methods and processes have their own history, which I use as the basis for the projects being developed today:
  • UOR technology is not new.  A US Bureau of Mines study in 1932 talked about the history of underground oil recovery.  The report describes how underground openings were dug in an oil deposit in France in the 1700’s, and the oil was collected in trenches along the floor.  Later, when drilling techniques were developed, wells were drilled into this oil deposit and more of the oil was recovered.  When the pressure that pushed the oil to the wells was depleted, and the oil was needed during World War I, more underground openings were made and more oil was recovered.  In the end, almost 90% of the oil that was in the deposit was produced.  Other oil mines in Germany were described.
  • Union Oil of California (Unocal) used underground openings to produce millions of barrels of oil up through the end of World War II, when the price of oil made the underground operations less economic.
  • During the oil crisis of the 1970’s, the Chief Mining Engineer and Deputy Director of the US Bureau of Mines (USBM) led a push to use underground oil recovery.  He got funding for several studies and convinced a few oil companies to evaluate the use of UOR.  The Mine Safety and Health Administration (MSHA) added underground mining regulations to provide specific instructions for how projects to produce from oil deposits (including oil shale and conventional petroleum deposits) should be built and operated as a result of interest expressed by the mining and petroleum industries.  Today, UOR is considered a currently available technology by the Department of Energy.
  • One result of the encouragement of the USBM was a $60 million program that ARCO conducted to evaluate underground oil recovery for an environmentally challenging heavy oil deposit containing over 10 billion barrels of oil.  I worked at Bechtel and we worked with the ARCO team to perform an independent evaluation of the technology.  Later, ARCO’s lead Mining Engineer told us that ARCO (at the CEO level) concluded the technology was attractive, but they did not want to apply UOR technology in a first-of-its-kind application in the challenging circumstances of their deposit.  The instructions given to the mining engineer was to take what was learned and work with others to show that it works on other sites and then come back to ARCO to consider it for their site.  (See “why industry isn’t using it” – above.)  He chose the company where I was working as a partner in that effort because of what that company could do and also to team with me.  (That company now is a partner working with UOR Tech.)  The ARCO deposit has not yet been fully developed and still is a target that can be evaluated for UOR development.
  • Several underground projects were constructed.  Conoco built an underground drilling platform in Wyoming in (about) 1978, but some safety issues developed from working inside the oil bearing rock and Conoco sold the project.  A smaller company took it over and continued to get oil out of that operation for many years, for a reported cost of $0.50 per barrel.  A multi-company program developed a very successful way to produce the Athabasca Tar Sands using underground drilling platforms. 
  • A Canadian firm has built a couple other small underground operations in this century, and that firm is currently working on evaluating and developing a few other sites.
 
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