Life
was fairly predictable prior to 1973, Texas State Geologist Scott
Tinker noted during a "power lunch" presentation at the recent APPEX
event. Then the Arab oil embargo hit, triggering the first major
energy price spike.
Since that time, oil and gas price cycles have become
increasingly compressed and demand has increased many-fold -- along
with U.S. dependence on imported oil.
Tinker, who presented a historical context as a setup
for some predictions of tomorrow's energy situation, noted energy
consumption in the United States can be divided into three time
periods:
- Prior to 1973, driven by supply.
- 1972-2000, driven by economics.
- Post-2000, driven by efficiency
"Research and technology have been there all the
way," he said, "responding as needed to the forces of supply, economics
and efficiency."
An energy forecast overview included some salient
points regarding the key energy sources:
- Coal efficiency is poor relative to oil and gas, and over the
next 50 years there will be a decrease in the percent of total
energy solids consumption.
- Oil is subject to price spikes and carries the added problem
of the security impact of the import ratio. While more environmentally
friendly than coal, both its environmental impact and its efficiency
take a back seat to gas. A decrease in consumption over the next
50 years is forecast. Near term, however, there is a huge gap
in the needed supply, to be filled with imports.
- Renewables (excluding nuclear) consumption has likely achieved
practical limits.
- Gas efficiency is high and still on the increase. It has a
low environmental impact, relative economic stability and is a
low security risk since most of it comes from domestic production.
There are huge gas needs that must be met over the next several
years.
Tomorrow's Key Research
Tinker outlined research areas that will play a key
role in domestic oil production:
- Rock physics -- the industry must learn to look at the rocks
in new ways.
- High frequency stratigraphy.
- Three-D and 9-C (or multicomponent) seismic.
- Three-D matrix and fracture modeling and simulation.
- Well technology.
The projected production volume that will come about
via research and technology is not anticipated to change the world,
Tinker said. But a graph of U.S. oil production out to the year
2020 depicted a technology wedge originating in 2001 that is projected
to account for two billion barrels over the following 20 years.
At $25/barrel, this represents $50 billion gross
oil value.
The domestic natural gas supply was all conventional
in origin until the 1960s, Tinker noted. However, charting the impact
of ongoing and future natural gas supply research activity reveals
that unconventional and subsalt supplies will account for more than
half of the projected future U.S. demand.
The key research areas that will impact natural gas
production are:
- Fracture description, modeling and physics.
- Salt modeling and characterization.
- Three-D and 9-C seismic.
- Deep-water sedimentation.
The bottom line, according to Tinker:
"Supply, economics and efficiency have driven U.S.
policy and energy consumption trends," he said. "For the next 25
years, technology should be directed toward improved oil recovery,
and research toward unconventional natural gas exploration.
"In commodities jargon," Tinker said, "buy oil short
and gas long."