Energy demand is soaring as never before and driving economic growth. Improved standards of living require increasing amounts of energy. In fact, some say that in 20 years the world will consume 40% more oil than it does today.
New energy discoveries are mainly occurring in places where resources are difficult to extract - physically, technically, economically, and politically.
Rising to the challenge, the petroleum industry is using technology to create greater efficiencies in retrieving and processing crude oil. Daniel Yergin, chairman of Cambridge Energy Research Associates, says that based on a new, field-by-field analysis of production capacity, "There will be a large, unprecedented buildup of oil supply in the next few years. Between 2004 and 2010, capacity to produce oil (not actual production) could grow by 16 million barrels a day - from 85 million barrels per day to 101 million barrels a day - a 20 percent increase. Such growth over the next few years would relieve the current pressure on supply and demand."2The Impact of Technology
Remember those old movies about fortune seekers looking to "strike oil"? Those scenes weren't far from the truth. For early explorers, the oil search could easily be hit or miss. Today's technology has enhanced the likelihood of finding oil, thus eliminating poor prospects and reducing wasted expenditures on dry holes. Drilling and production technologies have made it possible to exploit reservoirs that would formerly have been too costly to put into production and to increase the recovery from existing reservoirs.
To identify a prospective site for oil production, companies use a variety of techniques, including core sampling, which is physically removing and testing a cross section of the rock, and seismic testing, where the return vibrations from a man-made shockwave are measured and calibrated. State-of-the-art seismic testing can now locate deposits with three-dimensional underground maps. What would have been considered an unreachable site years ago can be accessed today, from up to five miles away! After these exploratory tests, companies drill to confirm the presence of oil.
Historically, drilling a "wildcat" well - searching for oil in a field where it had not yet been discovered - had a low chance of success. Better information, especially from seismic technology, has improved the success rate. Reducing the money wasted on dry holes is one of the aspects of upstream activity that has allowed the industry to find and produce oil at the prices prevailing over much of the 1990s.Advanced Recovery Methods
Large volumes of technically recoverable domestic oil resources remain undeveloped and are yet to be discovered in the United States. According to the Department of Energy, undeveloped domestic oil resources still in the ground total 1,124 billion barrels. Of this large "in-place" resource, 430 billion barrels is estimated to be technically recoverable.3
A full two-thirds of our nation's known oil resources may not be recoverable without the development and use of advanced technologies. The Department of Energy partners with the petroleum industry, universities and other research entities to develop enhanced oil recovery (EOR) technology. Research is uncovering new ways to use heat energy, chemicals and gases to push additional oil to the surface, or to lower its viscosity and increase its flow rate.