Saturday, May 28, 2011

Brief History of Canadian Oil Industry

1858: James Miller Williams made the first major oil discovery in Canada at Oil Springs, Ontario. Williams is commonly known as the founding father of the Canadian oil industry.

1908: The Bow Island gas field (Old Glory well) in Alberta was the first major discovery in Alberta’s imporatant commercial oil and gas exploration.

1914: Arthur Dingman found the Dingman wet gas in the Turner Valley in Alberta on May 14th.

1920: Dr. Karl Clark of the Alberta Research Council developed the hot water process to produce synthetic oil from strip mined bitumen (or the oil sands). This process is still currently employed. In the same year, the Ted Link, the most Nothernly oil discovery was also made.

1947: On February 13th, Imperial Oil finally struck oil in Leduc after drilling 133 dry holes. This major discovery transformed Canada from oil-poor to oil-rich country overnight.

1950s: The inter-provovinial oil pipeline (noe Embridge Inc.) was built from Alberta to Ontario. This is the world’s largest crude oil pipeline network.

1967: The first ommercially successful large-scale oilsands plant began operating near Fort McMurry using Dr. Clark’s method.

1979: The first flow of oil was produced on drillstem test from Hibernia P-15 on September 19th. It found two reserves of around 3 billion barrels of oil. Production started in 1997.

Breif History of Canadian Oil Industry

1858: James Miller Williams made the first major oil discovery in Canada at Oil Springs, Ontario. Williams is commonly known as the founding father of the Canadian oil industry.

1908: The Bow Island gas field (Old Glory well) in Alberta was the first major discovery in Alberta’s imporatant commercial oil and gas exploration.

1914: Arthur Dingman found the Dingman wet gas in the Turner Valley in Alberta on May 14th.

1920: Dr. Karl Clark of the Alberta Research Council developed the hot water process to produce synthetic oil from strip mined bitumen (or the oil sands). This process is still currently employed. In the same year, the Ted Link, the most Nothernly oil discovery was also made.

1947: On February 13th, Imperial Oil finally struck oil in Leduc after drilling 133 dry holes. This major discovery transformed Canada from oil-poor to oil-rich country overnight.

1950s: The inter-provovinial oil pipeline (noe Embridge Inc.) was built from Alberta to Ontario. This is the world’s largest crude oil pipeline network.

1967: The first ommercially successful large-scale oilsands plant began operating near Fort McMurry using Dr. Clark’s method.

1979: The first flow of oil was produced on drillstem test from Hibernia P-15 on September 19th. It found two reserves of around 3 billion barrels of oil. Production started in 1997.

Petroleum Exploration

The search for oil and gas deposits within the Earth’s subsurface is called petroleum exploration. Exploration is considered a part of the upstream process. During this process, an energy company will explore for hydrocarbons and extract that oil or gas in the most efficient manner. The refining and processing of the oil and gas and its distribution to the end customer is known as the downstream process. The petroleum exploration can be divided into two main stages. The first stage would consist of a desk study of the geology, geological maps and of field surveys. The second stage would consist of exploratory drilling and if necessary an appraisal process.

First Stage

During this preliminary stage of exploration, geo-scientists and geologists will review geological maps and/or aerial photography of a target site to identify faults and anticlines on the surface to determine if there is a potential for subsurface hydrocarbon deposit formations (E-Tech International , n.d).

Before any physical exploration of the site the exploration company will have to obtain exploration rights from the land owner (surface and subsurface mineral rights). A legally binding agreement has obtained be obtained from the private land owner or the government (Department of Employment, Economic Development and Innovation, 2010).

The exploration company will then pursue a more informative survey. This survey will consist of the following surveys (E-Tech International , n.d):

1. Magnetic Survey: measures the variations and intensity of the magnetic field which correlates the magnetic character of the various rocks.

2. Gravimetric Survey: involves the measurements of small variations in the gravitational field at the Earth surface.

3. Seismic Survey: This is the most common [informative] assessment method and is usually the first test. This survey uses sound waves to record the subsurface structure. The reflected sonic waves are recorded using:

i. Geophones/Seismometers on land

ii. Hydrophones in water/offshore

After the seismic tests have been conducted, they are further analyzed to determine the following (Imaduddin, 2008):

1. Find a geological feature [traps] that can act as an accumulator of oil/gas.

2. To ensure the [potential] oil/gas cannot escape.

3. Confirm that the area has the material to cook the oil and gas over geological time.

The different types of traps (if any present) from the survey are analyzed.

Types of Traps (Imaduddin, 2008)

1. Structural Traps

i. Anticline are easy to locate with low risk to extract

ii. Fault bound  easy to locate with fair risk to extract

2. Stratigraphic Traps

i. Pinchouts  tougher to locate with high risk to extract

ii. Channels  tougher to locate with high risk to extract

3. Morphological Traps

i. Buried Hill

ii. Reef

Second Stage

If the results from the ‘First Stage’ look promising, the exploration process will proceed with the ‘Second Stage’. This stage will confirm or refute the “suspicions” of hydrocarbon presence by drilling exploratory wells. These exploratory boreholes are commonly known as wildcats.

The core sample from the wildcat is sent to a laboratory for a detailed core analysis. The core is tested for porosity, grain density, horizontal permeability, fluid saturation and lithology description (Zeng, 2011). If the perforated wildcat well starts producing hydrocarbon fluids, a sample of that fluid is also sent to the laboratory is also sent to a laboratory for further PVT analysis and the well is closed (plugged with a ‘Christmas-tree’ valve if necessary) (E-Tech International , n.d).

If the lab tests are positive conditions for hydrocarbon, then further tests of the wildcat are carried out by inserting a sonde and determining the following Well Log Tests (Yang, 2010):

1. Spontaneous potential (SP) log

2. Gamma Ray Log

3. Porosity Logs

i. Sonic Logs

ii. Density Logs

iii. Neutron Logs

4. Resistivity Logs

5. Calliper log

According to Imaduddin, if the initial exploration wildcat’s results are promising, further exploration wells are drilled to gain further understanding (picture) of the subsurface formation (reservoir) and its economic feasibility is estimated. This is known as the appraisal step. The discovery is appraised by additional seismic 2D/3D imaging of the subsurface. Productive zones are mapped for a more accurate extent and thickness of the formation. This enables a more accurate calculation of the potential reserves (Imaduddin, 2008).

In short, the exploration process consists of the geological study, seismic study, exploration wells, core/fluid sampling, well logging and well testing (Zeng, 2011).

List of Five Key Words in Petroleum Exploration

Geological Survey

Seismic Survey

Exploratory Drilling

Well Log Tests

Appraisal (economic, field, fluid tests)

References

Department of Employment, Economic Development and Innovation. (2010, June ). Queensland

Government. Retrieved May 18, 2011, from Petroleum and Gas Exploration: Exploration laws explained:http://www.dme.qld.gov.au/zone_files/legislation_pdf/p&g_exploration_laws_explained.pdf

Encyclopedia Britannica Online. (2011). petroleum production. Retrieved May 18, 2011, from Britanica

Academic Edition: http://www.britannica.com/EBchecked/topic/1357080/petroleum-production/81761/Well-logging-and-drill-stem-testing

E-Tech International . (n.d). Overview of the oil and gas exploration and production process. Retrieved

May 18, 2011, from E-Tech International: http://www.etechinternational.org/new_pdfs/lessImpact/AttAoverview.pdf

Imaduddin, M. (2008, April 30). Petroleum Exploration Development and Production Process. Retrieved

May 18, 2011, from Bangladesh University of Engineering and Technology: http://www.buet.ac.bd/dce/course_material/pdf/petroleum_exploration_developement_production_process.pdf

Yang, D. D. (2010). Introduction to Petroleum Engineering. Retrieved May 18, 2011, from UrCourses:

University of Regina: https://urcourses.uregina.ca/

Zeng, D. F. (2011). Geology Aspects Of Reservoir Engineering. Retrieved May 2011, from Urcourses:

University of regina: https://urcourses.uregina.ca/