Concepts Shift Creates Ripples of Change

In North America onshore, the resource play has caused a dramatic shift in the exploration objectives of many, if not most, independent and major petroleum companies. No longer do companies explore for “conventional” targets – instead they focus almost entirely on resource plays.

As a result, many if not most North American exploration geologists – who work onshore are creating prospects that are potential new resource plays.

Outside of North America, industry is just beginning to explore for resource plays.


Changing basic concepts of anything that you are very familiar with can be especially challenging.

Gas shales for example, required changing our thinking about basic petroleum geology. Ten years ago not many of us imagined we would have to change our concept of shales as only source rocks or seals, to shales as reservoirs – reservoirs that have nano-darcies of permeability and are economic.

No one could have imagined the huge impact this conceptual change would have on the petroleum industry.

Now, the petroleum industry accepts the premise that shales are effective gas reservoirs where they have the right amount of organic matter, maturity and brittleness.

Shale gas reservoirs in the United States have reversed the natural gas production decline predicted by M. King Hubbert, who in 1956 predicted that U.S. gas production would peak about 1970 and that U.S. oil production would peak about 2000.

In retrospect, as far as gas is concerned, the actual U.S. gas production trend followed the Hubbert decline prediction pretty closely until sometime in the early 1990s, when the decline trend began to reverse.

Today, we are actually producing more gas in the United States than ever (figure 1).

Few thought this was possible. Natural gas is a finite resource and at some point natural gas production will decline. Now it will happen sometime in the future.

Hubbert was a very capable and highly respected geologist. His predictions of peak U.S. oil and gas production looked good to many people. In fact, his peak oil production curve still looks good (see figure 2, from Ahlbrandt 2011, after Charpentier 2005), but that may be changing as well.

During this coming year, AAPG will examine the impact of the resource play on our science. The resource play concept opens up many questions:

  • How has petroleum geology changed as a result of the resource play?
  • How has it changed our concept of the petroleum system?
  • What will the future petroleum geologist need to know to be effective?
  • How will we explore and develop resource plays?
  • What tools will we need to evaluate them or explore for them?
  • Where will new resource plays be located?

     


The emergence of the resource play could be termed a “black swan event.” Black swan events are unpredictable events that have huge, long-term impact.

In retrospect, black swan events always look like they should have been predictable, but they aren’t. Some examples of black swan events include the creation of the Internet, Google or 9/11.

Obviously, we can’t predict what will happen this year, either in our personal lives or for our collective efforts toward AAPG. But there are two things that I know:

  • AAPG needs to be ready to aid its members as they adjust to changing concepts, like the resource play.
  • The 2012-13 AAPG Executive Committee is well qualified to lead us – it has a good balance of industry and academic experience.

Our president-elect is Lee Krystinik. Lee is principal founder of Fossil Creek Resources, where he initiated a successful horizontal drilling play in the Cleveland Sandstone in north central Oklahoma.

Vice president-Regions is Stuart Harker, whose company, Circle Oil of Aberdeen Scotland, is exploring the North Sea.

Vice president-Sections is Tom Ewing, who is recognized for his many outstanding contributions to sorting out the geology of the U.S. Gulf Coast, where he is currently exploring for oil and gas with Yegua Energy Associates.

Editor Steve Laubach is senior research scientist with the Texas Bureau of Economic Geology in Austin. Some of his current research includes the emerging field of structural diagenesis, which considers fracture cementation.

Secretary Denise Cox is successfully prospecting for oil and gas in the west Texas Permian Basin with her company, Storm Energy of Panama City, Fla.

Treasurer Debra Sacrey is a successful Texas Gulf Coast independent/consulting geophysicist/geologist with the company she founded, Auburn Energy of Houston, Texas.

Chair of the House of Delegates is R. Randy Ray, independent geologist in Denver and chief geophysicist for Underground Energy Co.

Black swans and various challenges may both come our way this year, but we have a team that’s ready to respond for the good of AAPG.

I am very excited about the next year.

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President's Column

President's Column - Ted Beaumont

Edward A. "Ted" Beaumont, AAPG President (2012-13), is an independent consultant with Cimarex Energy.

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