Oil and gas distribution

Petroleum products, such as oil, and natural gas are essential for many everyday activities, but oil and gas are nonrenewable resources that are difficult to access and transport. A full understanding of the petroleum industry requires knowledge of the geologic processes behind petroleum reservoir formation and the technology used to find, extract, and process this critical resource.

Where Are Oil and Gas Located?

Crude oil production is centered in Russia, Saudi Arabia, the United States, Iran, Iraq, and Venezuela, but more than 80 percent of the world’s reserves are located in member countries of the Organization of Petroleum Exporting Countries, primarily Venezuela, Saudi Arabia, Iran, and the United Arab Emirates. Natural gas production, in contrast, takes place mainly in the United States, Canada, Iran, Algeria, and Russia. Reserves are primarily found in Russia, Qatar, the United States, and the United Arab Emirates.

Petroleum reservoirs are found in sedimentary rocks (sandstone, limestone, and dolomite). Igneous and metamorphic rocks form what is called basement rock, which underlies the sedimentary rock. Areas where the basement rock is at the earth’s surface are called shields; these areas lack petroleum reservoirs. Natural gas is found in the same reservoirs with oil, but natural gas can withstand extremes of pressure and temperature that oil cannot. Therefore, it can often be found at depths without concomitant oil.

Oil and gas form when organic matter decays at a rate that is slower than the rate at which sediment accumulates on top of it. In a reservoir, the oil and gas exist in the spaces between particles of sedimentary rock. Rock that holds oil and gas in its pores is called reservoir rock. Rock containing organic material that will later form oil and gas is called source rock.

One type of reservoir is called a trap, a rock formation that blocks the movement of oil and gas so that they accumulate beneath the rock. The gas rises to the top and the oil remains beneath it. Water often exists in the trap, too. A stratigraphic trap is made of reservoir rock surrounded by shale. The shale below is source rock, and the shale above is a sealing cap for the reservoir.

Finding Petroleum

In the early days of oil exploration, reservoirs could sometimes be located because they were leaky, meaning that the reservoirs’ oil was visible at the earth’s surface. These easily found reservoirs have long been tapped, so one of the most reliable ways to find petroleum is to drill test wells near or below current reservoirs.

To find a new oil field, one can use remote sensing methods to identify areas (namely, sedimentary basins) that might contain petroleum. Sedimentary rock has fewer magnetic minerals and lower density than magmatic rock and can easily be identified with magnetometry, gravimetry, reflection seismology, and basic knowledge of an area’s geologic processes and formation. Thicker sedimentary rock is associated with larger amounts of petroleum. Seismology is helpful in offshore exploration because it measures the thickness of sedimentary rock on the ocean floor. Petroleum reservoirs also are associated with tectonic activity. Some of the largest oil fields in the world exist where the Arabian plate is colliding with the Eurasian plate.

After geologic information is used to locate potential reservoirs, an exploratory well is drilled to verify the presence of hydrocarbons—that is, hydrogen-carbon compounds, which make up the primary component of oil. The next step is the development of appraisal wells, which are used to gather more detailed data and to determine the shape and extent of the formation. During the drilling of an appraisal well, a geologist will keep a mud log, a record of the types of rock being penetrated; the log also will note if hydrocarbons are present.

Because hydrocarbons have a different electrical resistivity than water, instruments may be sent down the well to measure resistivity. These tools allow a reasonably accurate mapping of the reservoir, but nothing is certain until the well produces. A drill stem test is a highly controlled way of testing for actual production potential by using a valve mechanism to access the reservoir without fully opening it. After the test, the valve is sealed.

The Drilling Process

There are two methods of drilling: cable-tool drilling, which involves using force to ram a hole into the earth to access the reservoir, and rotary drilling, which works in a manner similar to a household drill, with a bit that turns and cuts through the rock. Cable-tool drilling is expensive and has fallen out of use in most areas.

Drilling is used to make four types of wells: exploration, appraisal, production, and injection. After assessing geologic data, a company will drill an exploration well. If hydrocarbons are found, appraisal wells are drilled in the surrounding area to determine the extent and shape of the reservoir. Exploration or appraisal wells can, in some cases, become production wells. An injection well is meant for adding material to a reservoir to increase the pressure and drive the hydrocarbons out of the production well.

Occasionally, a reservoir is located beneath something that will be difficult to drill through vertically (for example, a mountain). When this happens, a vertical well may be drilled some distance away, and the reservoir may be accessed by drilling a horizontal well that extends from a point along the vertical well.

Once the well is in place and producing, the initial flow of oil and gas can be extracted with comparative ease because the contents of the reservoir are under pressure. As the levels in the reservoir are drawn down, drive mechanisms are needed to force more reservoir contents out through the well. Some of these processes occur naturally as the gases expand. Sometimes the water below the oil expands, forcing the oil upward. If none of these processes occurs, or if they are no longer sufficient to extract remaining hydrocarbons, artificial lift can be employed through pumping or by injecting gas or water, or both. These processes are collectively known as improved oil recovery. In contrast, enhanced oil recovery employs chemicals, heat, and gases to loosen oil from the reservoir rocks.

Drilling Equipment

The main drilling apparatus, called the drill string, comprises the drill bit, the drill pipe (through which drilling mud and fluids can be pumped), and collars to weigh down the bit. The initial drilling makes a hole large enough to contain the casing, the metal pipe that will provide the structure for the well. The space between the drill string and the casing is called the annulus.

After fluids are pumped down the drill pipe, they come back up, with the drill cuttings, through the annulus. During completion of the well, cement is pumped down the annular space to seal the spaces between sections of casing. The well is perforated at levels where hydrocarbons are present to allow the hydrocarbons to flow into the well. A wellhead (sometimes called a tree or a Christmas tree) is installed to control flow.

The drill string is suspended from a structure called a derrick. Derricks can be assembled and disassembled at different locations on land, or they can be mounted on drilling platforms offshore. Regardless of location, a derrick must be strong and tall enough to support all of the equipment needed for the well casing and drill string. Thus, for deep-water drilling, the derrick must support 1 million pounds or more.

A derrick is part of either a land rig, a jack-up rig (used in shallow water), or an offshore rig (a drill ship, submersible rig, or semisubmersible rig). The type of rig used depends upon location. In shallow waters, submersibles or jack-ups are used. In deep water, mobile rigs are more economical than fixed rigs. A drill ship lays down a template at the drill site on the ocean floor (along with a blowout preventer) and lines up the drill string.

A blowout preventer is a massive piece of equipment that will cut off the flow of oil from the reservoir in an emergency. Uncontrolled flow from the reservoir can cause explosions, fires, and other disasters, such as the rig disaster on the Deepwater Horizon in the Gulf of Mexico in 2010. A blowout preventer is like a giant clamp or shutoff valve placed either at the bottom of the ocean or on a rig platform. On land, it is placed beneath the rig.

A substance called drilling mud is used to lubricate the drill and to ease the way as the rock cuttings are extracted from the hole. The other important function of drilling mud is to prevent inflow of oil, gas, and water into the well before drilling is completed. To this end, the drilling mud must be heavier than whatever substance it is designed to keep out. Various chemicals and other additives are used to adjust the composition of drilling mud. A mud log is kept to record what the drill bit is penetrating (such as the type of rock) and whether hydrocarbons are present.

Technology Used in Storage and Transit

Many oil fields have processing facilities. Oil is transported directly from the well to separation, treatment, and storage equipment through steel, plastic, or fiberglass flow-lines (pipes). One of the initial processing steps is to run the oil through a separator, which divides gas from liquid. A gas scrubber, in a process called stripping, draws off any trace liquids. This is an important step because liquid and gas hydrocarbons have different requirements for transit.

Gas may be fully processed on-site or may be processed so that it is transportable. Transportable gas excludes liquids to prevent condensation in the pipeline. Corrosive compounds also are removed, and then the gas is compressed. Gas pipelines are placed underground, unlike oil pipelines, which are usually above ground. Because of the high costs of transporting gas, the most economical and efficient use of natural gas is to use the gas close to the place of extraction.

Liquid petroleum is put into welded-steel stock tanks for storage. It is subsequently loaded onto trucks to be taken to a refinery, or it is transported through a pipeline. In the case of offshore wells with no nearby pipeline, oil may be put into floating production, storage, and off-loading vessel. A vessel used only for transit and not for processing is simply referred to as a floating storage and off-loading vessel.

After the Exxon Valdezoil spill in 1989 in Alaska, the U.S. Congress passed the Oil Pollution Act of 1990, which changed specifications for tankers transporting oil in the United States. The law required the phasing out of single-hulled tankers in favor of double-hulled tankers. In a double-hulled tanker, the containers of oil are protected by an inner hull and an outer hull, which are separated by an interstitial space for ballast water. Countries other than the United States have adopted similar oil transport legislation, but not all of this legislation requires the use of double-hulled tankers.

The Future of Oil and Gas

Because gas is more difficult and more costly to transport, and because the energy yield from gas tends to be lower than that from oil, gas resources are exploited primarily when they occur with oil. Some reservoirs contain only gas, but the distribution of gas is limited in comparison with oil. The types of gas resources that have been tapped in significant amounts are called conventional gases, and they can be extracted with existing technology.

As technology improves, humans may come to rely more upon what are called unconventional gases, including coal-bed methane, tight gas, shale gas, and methane hydrates. These gases, however, are not economical to access and extract. Coal-bed methane reserves are coal deposits with methane. The barrier to widespread extraction is the cost of processing and disposing of the water by-products.

Tight gas and shale gas are found in rock that does not easily release the gases. Extraction involves the use of more invasive methods than standard wells. Hydraulic fracturing (fracking), a process by which water and chemicals are injected into shale to break it up, is a controversial method used to extract shale gas because it is associated with groundwater contamination and other hazards. Methane hydrates, which are found in glacial deposits, have not been extensively documented or explored because of their inaccessibility.

One of the most high-profile changes in oil extraction is the drilling of ever-deeper wells. The well that was being drilled at the time of the Deepwater Horizon blowout reached 5,596 meters (3.48 miles) below sea level, and the rig was capable of drilling to nearly twice that depth. Even with the best technology, obtaining and transporting petroleum products is a risky enterprise, but one that is increasingly necessary to maintain industry at current levels.

Principal Terms

basin: area containing thick sedimentary rock; usually rich in hydrocarbons

casing: the metal pipe that provides the structure for a well

derrick: apparatus from which a drill string and casing are suspended

drilling mud: substance used to lubricate a drill and to prevent oil from flowing into the well during drilling

drill string: the main drilling apparatus, made up of a drill bit, drill pipe, and collars to weigh down the bit

enhanced oil recovery: the use of heat, chemicals, or gases to loosen oil from reservoir rocks

fracking: hydraulic fracturing, which uses water and chemicals to break up shale and release natural gas

hydrocarbons: compounds of hydrogen and carbon; the main components of petroleum and natural gas

improved oil recovery: the process of pumping oil out or injecting gas and water to increase pressure in a reservoir, thereby forcing oil out

reservoir rock: sedimentary rock that holds oil or gas in the spaces between particles

source rock: rock containing organic materials that will be made into oil and gas

trap: a type of rock formation that causes hydrocarbons to accumulate (trapping them), forming a reservoir

tree: a wellhead; a fixture to control the flow of oil and gas; sometimes called a Christmas tree

Bibliography

Freudenburg, William, and Robert Gramling. Blowout In the Gulf: The BP Oil Spill Disaster and the Future of Energy in America. Cambridge, Mass.: MIT Press, 2011. Uses the 2010 Deepwater Horizon disaster as a starting point for a comprehensive discussion of the oil industry, particularly with regard to policy, resource accessibility, disaster prevention, and the future of petroleum exploration and extraction.

Hyne, Norman. Nontechnical Guide to Petroleum Geology, Exploration, Drilling, and Production. Tulsa, Okla.: PennWell, 2001. An excellent resource for study of the specific geology of hydrocarbon reservoirs, including types of rock and the geologic processes behind the formations in which reservoirs are most often found.

Maugeri, Leonardo. Beyond the Age of Oil: The Myths, Realities, and Future of Fossil Fuels and Their Alternatives. Santa Barbara, Calif.: Praeger, 2010. Describes in clear, concise language the different types of fossil fuels and issues with their use. Particularly useful is the chapter on natural gas, which is often given scant coverage in other publications.

Raymond, Martin, and William L. Leffler. Oil and Gas Production in Nontechnical Language. Tulsa, Okla.: PennWell, 2006. Describes in detail the different types of drilling, parts of drilling rigs, methods of drilling both onshore and offshore, and the process of drilling, step by step, including logging, testing, well completion, and hydrocarbon recovery.

Shepherd, Mike. Oil Field Production Geology. Tulsa, Okla.: American Association of Petroleum Geologists, 2009. Supplies photographs of drill bits and rigs, diagrams of drill strings and casings, and drawings of different types of reservoir formations, elucidating the mysteries of drilling equipment and the location of petroleum reservoirs.

Speight, James G. An Introduction to Petroleum Technology, Economics, and Politics. Hoboken, N.J.: John Wiley & Sons, 2011. Concisely provides background on the location, extraction, processing, and transportation of petroleum, but is valuable for giving economic and market context to the technical information.