What Happened to U.S. Oil Production?
April 17, 2006 6:04 PM Subscribe
I remember back in the eighties when a huge output of oil came from the United States, particularly three states: Texas, Oklahoma and Louisiana. My question is simple - What Happened??? Why isn't there a lot of oil coming out of those states anymore? I have heard about "capped" wells and don't understand. Are companies still drilling in the oil rich states? If so, why can't it be increased to deal with the current Middle East oil supply? Inquiring gasoline consumers want to know!
Every drop that would cost less than $70/barrel, that is.
posted by smackfu at 6:11 PM on April 17, 2006
posted by smackfu at 6:11 PM on April 17, 2006
US oil production has already experienced peak oil (in the 70's)
It has been down-hill since then. The middle east is the only region (besides perhaps canada) that has not peaked, I think.
posted by clord at 6:13 PM on April 17, 2006
It has been down-hill since then. The middle east is the only region (besides perhaps canada) that has not peaked, I think.
posted by clord at 6:13 PM on April 17, 2006
Pretty graphs (PDF). While production has been decreasing since the 70's, the dependence on foreign oil is at least equally caused by the increasing consumption. Even if the US oil production rate was flat, we'd still need more oil from elsewhere to meet our ever growing needs.
posted by smackfu at 6:15 PM on April 17, 2006
posted by smackfu at 6:15 PM on April 17, 2006
Google for Texas oil bust. The bust hit Texas very hard. Cool graph about the percentage of oil to Texas' gross state product here.
posted by tayknight at 6:17 PM on April 17, 2006
posted by tayknight at 6:17 PM on April 17, 2006
in the oil rich states
it's a limited resource. stuff gets used up. Pennsylvania was the first "oil rich" state, but things change.
new technologies can sometimes increase potential production, but as it is, it's economically smarter to import a certain percentage & be prudent about whatever we've got left.
A good history on the industry, & a really enjoyable piece of non-fiction, is Daniel Yergin's The Prize.
posted by mdn at 6:18 PM on April 17, 2006
it's a limited resource. stuff gets used up. Pennsylvania was the first "oil rich" state, but things change.
new technologies can sometimes increase potential production, but as it is, it's economically smarter to import a certain percentage & be prudent about whatever we've got left.
A good history on the industry, & a really enjoyable piece of non-fiction, is Daniel Yergin's The Prize.
posted by mdn at 6:18 PM on April 17, 2006
Response by poster: Very interesting responses. I remember the 80s oil boom/bust, but really never understood it was because of lack of resources. I always thought the bust came about because importing cheap oil was less expensive for the refiners. Is that completely wrong? It was all related to using up the resources? I'm going to go read the links now. Fascinating.
posted by Gerard Sorme at 6:23 PM on April 17, 2006
posted by Gerard Sorme at 6:23 PM on April 17, 2006
The EIA is your source for all things energy related for the U.S.
Here's a nice overview along with some good summary statistics.
And here's a good discussion of historical prices for oil -- including what went on in the 80's.
Enjoy.
posted by bim at 6:33 PM on April 17, 2006
Here's a nice overview along with some good summary statistics.
And here's a good discussion of historical prices for oil -- including what went on in the 80's.
Enjoy.
posted by bim at 6:33 PM on April 17, 2006
Basically: Peak Oil. And what happened to those states in the 1970s is happening to the entire world now. Have a nice day :)
posted by delmoi at 6:53 PM on April 17, 2006
posted by delmoi at 6:53 PM on April 17, 2006
I note that in the graphs smackfu linked to, while there's a clear drastic decline in crude oil production, natural gas production plateaued for a bit but has been making a steady increase, passing the 1970s peak even.
What's involved in the production of natural gas? Is research into increased production of it a viable alternative to importing crude oil?
Odd side note: While using the spell check to see if I got "plateaued" right(it's not a word :-/), it suggested "personality" as a replacement for "1970s". How about those hippies, eh?
posted by ElfWord at 7:00 PM on April 17, 2006
What's involved in the production of natural gas? Is research into increased production of it a viable alternative to importing crude oil?
Odd side note: While using the spell check to see if I got "plateaued" right(it's not a word :-/), it suggested "personality" as a replacement for "1970s". How about those hippies, eh?
posted by ElfWord at 7:00 PM on April 17, 2006
four letters: NIMBY, well OK 5. The wacko environmentalists won't even allow windfarms. Do you think they would allow actual oil drilling? Remember back in the 70's when they wanted to drill off of Georges Bank off the coast of Massachusetts? Crazy people said it would bother the fish...funny thing is now they say the same thing about an offshore Wind farm. Cripes. Ain't ther no pleasing them? (grin)
posted by Gungho at 7:14 PM on April 17, 2006
posted by Gungho at 7:14 PM on April 17, 2006
Many stripper wells, those with a slow but steady production were shut down in the 80's, at least in part due to the then price of oil making them unattractive - prevailing standards required they be capped, i.e., grouted up, not just sealing the end of the pipe, the latter of which would have presumably allowed production to be restarted. They are thus effectively lost. Given the cost of drilling, they aren't (or haven't been) worth reclaiming. A not inconsequential amount of domestic production was lost thereby.
Drilling is very hot right now in N. central Texas. Much of the past drilling was not done at adequate depth - the current cost of oil is making that more attractive.
posted by Pressed Rat at 7:25 PM on April 17, 2006
Drilling is very hot right now in N. central Texas. Much of the past drilling was not done at adequate depth - the current cost of oil is making that more attractive.
posted by Pressed Rat at 7:25 PM on April 17, 2006
Response by poster: Gungho, I have wondered about this very thing, with so much developed land in and around major cities in the energy states. Texas and Oklahoma have several of the largest cities in the United States in terms of land area. Anybody who has been to Dallas, Houston, Oklahoma City can tell you they are sprawling cities. The core cities are surrounded by huge metropolitan areas that go on and on and on with new developments all the time in urban sprawl run amuk. I remember a professor saying that there are rich oil supplies under all that sprawl. Could a time come when it's more important to get to what's underneath the ground than preserving another mega-shopping big-box complex?
posted by Gerard Sorme at 7:25 PM on April 17, 2006
posted by Gerard Sorme at 7:25 PM on April 17, 2006
ElfWord: I'm not an expert at all on natural gas, but I've read a few documents about it on the FERC web site that suggest US production is expected to peak in about 50 years, even though demand is climbing (it's used to generate relatively cheap electricity & is also increasingly an alternative fuel source for automobiles.)
The feds are trying to encourage more imports of natural gas from the Pacific Rim and Australia, where there are vast reservoirs of the stuff. It's pretty much always liquified at the source via chilling (to around negative 260 Farenheit), then loaded onto massive ocean going tankers. Liquification makes it more stable and denser, so it's easier to transport large quantities. Once it gets to the US, it's regassified at coastal terminals -- at least, that's the idea.
Liquified natural gas (LNG) importing is very controversial because of the NIMBY factor and safety risks involved with importing anything volatile. Several big companies have had local governments thwart their efforts to import LNG because of safety concerns (think mile-wide ball of fire in a worst-case disaster scenario). But there are more than 40 applications to bring it into the US -- three or four in Oregon, a bunch in California, and a whole lot in the Gulf of Mexico and up and down the East Coast. And the Bush administration's big energy bill of not that long ago took away some local control in LNG terminal permitting and put it in the hands of FERC (the Federal Energy Regulatory Commission), so at least some of the many proposed natural gas import terminals are bound to be permitted and approved soon.
posted by croutonsupafreak at 7:36 PM on April 17, 2006
The feds are trying to encourage more imports of natural gas from the Pacific Rim and Australia, where there are vast reservoirs of the stuff. It's pretty much always liquified at the source via chilling (to around negative 260 Farenheit), then loaded onto massive ocean going tankers. Liquification makes it more stable and denser, so it's easier to transport large quantities. Once it gets to the US, it's regassified at coastal terminals -- at least, that's the idea.
Liquified natural gas (LNG) importing is very controversial because of the NIMBY factor and safety risks involved with importing anything volatile. Several big companies have had local governments thwart their efforts to import LNG because of safety concerns (think mile-wide ball of fire in a worst-case disaster scenario). But there are more than 40 applications to bring it into the US -- three or four in Oregon, a bunch in California, and a whole lot in the Gulf of Mexico and up and down the East Coast. And the Bush administration's big energy bill of not that long ago took away some local control in LNG terminal permitting and put it in the hands of FERC (the Federal Energy Regulatory Commission), so at least some of the many proposed natural gas import terminals are bound to be permitted and approved soon.
posted by croutonsupafreak at 7:36 PM on April 17, 2006
I'm offshore (well, sitting at the dock at Fourchon, Louisiana) and I can tell you offshore drilling is going full-throttle right now. Like others have pointed out, what was too expensive to get before makes sense at $60 a barrel.
New techniques for synthetically combining old seismic survey data from different sources have also made it possible to discover a lot of medium-sized reservoirs in areas that were thought to be tapped out. Directional drilling has made it easy to exploit those deposits.
posted by atchafalaya at 7:42 PM on April 17, 2006
New techniques for synthetically combining old seismic survey data from different sources have also made it possible to discover a lot of medium-sized reservoirs in areas that were thought to be tapped out. Directional drilling has made it easy to exploit those deposits.
posted by atchafalaya at 7:42 PM on April 17, 2006
One of the best-kept secrets around is just how much oil is produced in and around Los Angeles. Oil literally seeps out of the ground in Griffith Park. Beverly Hills High School has an oil well on the school grounds. And of course, we've all heard of the La Brea tar pits...
posted by frogan at 8:28 PM on April 17, 2006
posted by frogan at 8:28 PM on April 17, 2006
Most of the earlier references to peak oil are on target, as far as the theory goes. M. King Hubbert was pretty darn close in his estimates related to the continental United States.
mdn and frogan are also correct; there were/are other areas in the US besides the gulf coast states. The first super-giant oil field in the world was in the Bakersfield/Kern County region in California's central valley.
The problem stems from the fact that oil is a finite resource, at least in the (geologically) short-term. As biological materials are cooked to certain temperatures and pressures, kerogen and then oil or natural gas is produced. Within the human time-scale, petroleum isn't renewable.
After that, it comes down to economics. It costs a phenomenal amount of money to find a new oil field, an incredible amount of money to drill a single well, and no little amount of money just to operate a well once it's drilled. Unless you've got an overpressured well, a "gusher", you're always going to need electricity to run the pump and in the Rocky Mountain fields it almost always takes electricity to keep the oil warm enough to be able to flow up the pipe.
California residents got used to seeing dormant "dippers" through the 90's, but as the price of oil has risen, most of the stripper wells are back in production. As we push into the high $60 and $70 per-barrel-range, oil fields that weren't economical to operate or drill are suddenly interesting again. As prices rise, ever more marginal wells and fields are viable. Leases for possible superdeep wells in the Gulf are getting/have been snapped up when no one was even interested just 5 years ago. (In a rediculously poor bit of timing, I was graduating from a MS in geology at the time, when oil was varying between low $20 and $30 per barrel, and no oil companies were hiring anyone)
In the 1- to 3-year term, the amount of oil available is function of the existing wells and fields and the price per barrel. In the 1980's, the gulf coast states were already past-peak, so as OPEC drove up prices, wells that had not been economically viable came back on line and more new wells were drilled. If you're starving badly enough, you'll start fighting the mice for even the smallest scraps.
Ironically, the US was really the world's first oil superpower. So much so that conservation still runs against the national character. Worse yet, petroleum engineers have much better knowledge today than they did in 1870-1950; between flaring off the natural gas that could have provided better driving pressures and overdeveloping fields, we could have done a much better job than we did.
Even within the industry, most petroleum geologists will admit that peak oil is a real problem. They may argue about when it's coming, but the consensus seems to be around 20 to 50 years, depending on the rate of economic and industrial development of China and India. Peak Oil doesn't mean that petroleum becomes instantaneously unavailable, but given that it's a finite resource and the number of people and each person's energy demands both keep going up, prices (at least on the whole) seem likely to keep going up.
To put on my wacko-environmentalist cap for a minute, it would seem to make sense to at least try to plan towards the future and investigate alternative energy sources and alternative fuels before the associated economic and social upheaval arrives on our collective doorsteps.
posted by mhespenheide at 9:56 PM on April 17, 2006
mdn and frogan are also correct; there were/are other areas in the US besides the gulf coast states. The first super-giant oil field in the world was in the Bakersfield/Kern County region in California's central valley.
The problem stems from the fact that oil is a finite resource, at least in the (geologically) short-term. As biological materials are cooked to certain temperatures and pressures, kerogen and then oil or natural gas is produced. Within the human time-scale, petroleum isn't renewable.
After that, it comes down to economics. It costs a phenomenal amount of money to find a new oil field, an incredible amount of money to drill a single well, and no little amount of money just to operate a well once it's drilled. Unless you've got an overpressured well, a "gusher", you're always going to need electricity to run the pump and in the Rocky Mountain fields it almost always takes electricity to keep the oil warm enough to be able to flow up the pipe.
California residents got used to seeing dormant "dippers" through the 90's, but as the price of oil has risen, most of the stripper wells are back in production. As we push into the high $60 and $70 per-barrel-range, oil fields that weren't economical to operate or drill are suddenly interesting again. As prices rise, ever more marginal wells and fields are viable. Leases for possible superdeep wells in the Gulf are getting/have been snapped up when no one was even interested just 5 years ago. (In a rediculously poor bit of timing, I was graduating from a MS in geology at the time, when oil was varying between low $20 and $30 per barrel, and no oil companies were hiring anyone)
In the 1- to 3-year term, the amount of oil available is function of the existing wells and fields and the price per barrel. In the 1980's, the gulf coast states were already past-peak, so as OPEC drove up prices, wells that had not been economically viable came back on line and more new wells were drilled. If you're starving badly enough, you'll start fighting the mice for even the smallest scraps.
Ironically, the US was really the world's first oil superpower. So much so that conservation still runs against the national character. Worse yet, petroleum engineers have much better knowledge today than they did in 1870-1950; between flaring off the natural gas that could have provided better driving pressures and overdeveloping fields, we could have done a much better job than we did.
Even within the industry, most petroleum geologists will admit that peak oil is a real problem. They may argue about when it's coming, but the consensus seems to be around 20 to 50 years, depending on the rate of economic and industrial development of China and India. Peak Oil doesn't mean that petroleum becomes instantaneously unavailable, but given that it's a finite resource and the number of people and each person's energy demands both keep going up, prices (at least on the whole) seem likely to keep going up.
To put on my wacko-environmentalist cap for a minute, it would seem to make sense to at least try to plan towards the future and investigate alternative energy sources and alternative fuels before the associated economic and social upheaval arrives on our collective doorsteps.
posted by mhespenheide at 9:56 PM on April 17, 2006
Gungho, I have wondered about this very thing, with so much developed land in and around major cities in the energy states. Texas and Oklahoma have several of the largest cities in the United States in terms of land area. Anybody who has been to Dallas, Houston, Oklahoma City can tell you they are sprawling cities.
Well, they are flat areas, especially Oklahoma City. I believe OKC is still the third largest city in the US in acreage (behind Juneau and Jacksonville IIRC).
The core cities are surrounded by huge metropolitan areas that go on and on and on with new developments all the time in urban sprawl run amuk. I remember a professor saying that there are rich oil supplies under all that sprawl. Could a time come when it's more important to get to what's underneath the ground than preserving another mega-shopping big-box complex?
In the case of Oklahoma City, no. They never banned drilling inside the city limits. In fact, the vaunted oil wells in front of the state capitol stopped pumping oil years ago.
Dallas I don't believe lies on a major oil pool. Houston I think also didn't ban drilling.
Tulsa, though, did ban drilling in the 1920s, and it's thought that the Red Fork field may still contain some usable petroleum (and that there may be more oil within the city limits). Glenpool has been played out for years and was down to stripper wells by the 1980s.
posted by dw at 10:59 PM on April 17, 2006
Well, they are flat areas, especially Oklahoma City. I believe OKC is still the third largest city in the US in acreage (behind Juneau and Jacksonville IIRC).
The core cities are surrounded by huge metropolitan areas that go on and on and on with new developments all the time in urban sprawl run amuk. I remember a professor saying that there are rich oil supplies under all that sprawl. Could a time come when it's more important to get to what's underneath the ground than preserving another mega-shopping big-box complex?
In the case of Oklahoma City, no. They never banned drilling inside the city limits. In fact, the vaunted oil wells in front of the state capitol stopped pumping oil years ago.
Dallas I don't believe lies on a major oil pool. Houston I think also didn't ban drilling.
Tulsa, though, did ban drilling in the 1920s, and it's thought that the Red Fork field may still contain some usable petroleum (and that there may be more oil within the city limits). Glenpool has been played out for years and was down to stripper wells by the 1980s.
posted by dw at 10:59 PM on April 17, 2006
I've been told by several professors that were it not for the Second World War, the United States would have been able to remain self-sufficient on domestic oil for many more decades than the fact. We shipped oil to all our allies, and of course, operated our own war machine.
posted by Atreides at 5:56 AM on April 18, 2006
posted by Atreides at 5:56 AM on April 18, 2006
This thread is closed to new comments.
At $70/barrel, you can be absolutely certain they're getting every drop they physically can.
posted by Malor at 6:10 PM on April 17, 2006