Titan Oil Recovery: Lower oil prices spur innovations to meet the the continued need for fossil fuels ... WITHOUT FRACKING
-Gary V. Awad serves on the Board of Petro Life Energy, Inc., and is an Advisor to Titan Oil Recovery, Inc., whose non-fracking alternative to enhanced oil recovery from older oil fields promises to revolutionize the industry.
The conventional wisdom of Econ 101: Lower prices lead to higher demand and lower supply, eventually stabilizing prices. But when it comes to oil, the responsiveness of supply to lower prices is more complicated. Yes, high oil prices helped spur the innovations that enabled production of higher cost shale gas and shale oil. Now, however, lower prices are encouraging oil producers to seek recovery of the lowest cost oil available: that is, oil still trapped in existing older oilfields. This is oil that doesn't require additional drilling or fracking to recover.
The recent decrease in oil prices now forces companies to look elsewhere for the cheapest incremental barrels. Essentially these barrels are in the same petroleum reservoirs from which they have been producing for years. There is wisdom in the old saying, "The best place to find oil is where it has already been produced!" This reduces the need to drill new wells or resort to fracking of shale formations.
Beginning with the least costly primary recovery technologies, increasingly more costly secondary and even tertiary production techniques in most oil reservoirs can enable cumulative production to eventually reach as much as 35 – 40% of the original-oil-in-place (80-85% for gas-in-place in natural gas reservoirs). The remaining barrels are often left in the reservoir as economically "un-producible" when oil fields are abandoned. Lower prices, however, encourage companies to look to new technologies, other than fracking, that can more cheaply and safely recover some of the 60-65% of the original-oil-in-place still trapped in these older reservoirs.
For example, just as the industry has learned to utilize the naturally occurring high pressures and temperatures to tap oil bearing shales in deep formations, it is now utilizing new techniques and cost saving innovations to encourage the naturally occurring microbes in sandstone reservoirs, from which most of the world's oil is produced, to break down the oil droplets and change the fluid flow characteristics that impact fluid dynamics in the oil reservoir—allowing oil to flow more easily into the producing well bore.
Microbes are beginning to be viewed as a new concept of nano-technology in other industries such as in medical and materials science, the hidden world of microbes is just beginning to emerge in the energy industry. It is a mix of petroleum engineering and microbiology—perhaps, strange and unexpected "bedfellows".
This organic oil recovery technology, biodegradable and safe, tests the fluids in a reservoir to find the nutrients that feed these microbes already living in the reservoir, then creates and injects a designer blend of organic nutrients to energize the microbes, enabling them to change the flow characteristics of the oil droplets. Injecting the nutrients requires no additional infrastructure or capital, so costs are less than $10 per barrel of incremental oil recovered. The process replicates and accelerates a natural phenomenon that has been overlooked for decades
One such oil service company has now performed over 300 treatments in more than 50 different mature fields operated by some of the largest petroleum companies in North America and Southeast Asia. The fields typically have an age and production history placing them close to abandonment. The treatments have generated, on average, a production rate increase of over 100%, giving old wells a new lease on life. Yes, this is still an emerging technology for the oil industry but the oil price drop in recent years will require just such low cost, new and innovative techniques to produce the oil we need. And best of all, no further drilling of new wells or fracking is required. We will be able to produce already discovered but previously trapped oil to help us bridge the energy demand gap to a future free of fossil fuels.
So with lower oil prices, look for more, not less, oil production from existing reservoirs, without further drilling, as companies tap the trapped oil they have already found that's still waiting to be produced.