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BP finds hidden trove of oil in Gulf of Mexico

BP finds hidden trove of oil in Gulf of Mexico thumbnail

British oil major BP has discovered 200 million barrels of oil in a hidden cache in the Gulf of Mexico, thanks to a technological breakthrough allowing the company to see beneath geological formations that had befuddled oil exploration for decades.

The find, worth a potential $2 billion in recoverable oil, is in an undrilled section of BP’s Atlantis field in 7,000 feet of water 150 miles from New Orleans. Long obscured by a salt dome, which distorts seismic waves that oil companies use to map features below the earth, the oil reserves were revealed by using a supercomputer and mathematical algorithm to interpret the seismic data in a new way.

The Gulf find is another example of oil companies advancing technology to make unexpected discoveries. The advent of seismic imaging allowed oil and gas companies to model mineral layers below the earth’s surface and drill more precisely. The combination of horizontal drilling and hydraulic fracturing unleashed the U.S. onshore shale revolution.

Now, BP’s imaging advance could save drillers hundreds of millions of dollars in false starts and dry wells, and perhaps more important, prevent them from passing up billions of dollars in oil hidden within reach of existing platforms and pipelines.

Imaging under salt formations is a “holy grail,” said Ed Hirs, an energy fellow at the University of Houston and managing director of a small oil exploration and production company. “That’s really pretty big.”

This breakthrough, however, comes when the world is awash in crude and some analysts and economists – even at major companies such as Royal Dutch Shell – predict that demand for oil will wane as soon as the end of the next decade, forcing companies to leave billions of barrels of oil in the ground.

BP itself has shifted its focus in recent years to cleaner-burning natural gas, a very public move toward its view of a low-carbon future, as governments around the world address climate change.

But BP executives say the work of salt imaging still fits the company’s main goals, specifically to find and extract oil economically.

Salt has been a barrier

Salt domes have stumped scientists for years. Such geology in deep water is usually promising because the formations trap oil and gas in underground pockets for easy extraction. But companies hadn’t been able to image under the domes with much clarity.

To drill, oil companies need to see underground. They hire ships that project seismic waves through the ocean and into the earth. Those waves hit rock, bounce back, and the companies measure the returning waves to build images of the subsea earth and identify likely oil and gas traps. But when seismic waves hit salt, they refract more than reflect, like light streaming through a glass bottle.

The inconsistency – “a bunch of scrambled nonsense,” said BP geophysicist John Etgen – obscures the images of the earth under the formations.

That’s left oil companies in a predicament: They know there’s oil under salt domes, but not exactly where. If they drill blindly, they are likely to miss the mark – the industry success rate in such endeavors runs between eight and nine dry holes out of every 10 wells drilled, BP said.

And contractors have charged as much as $500,000 a day to drill in Gulf deep water. One well can cost $100 million or more.

Scientists at the BP’s Energy Corridor office park worked for years to improve subsea imaging under salt domes and identify new oil deposits. Then, last year a BP scientist fresh out of out of graduate school asked his bosses if he could borrow the company’s 15,000-square-foot supercomputer to run an algorithm he had developed.

Xukai Shen wanted to use the machine for two weeks. And in that time he and his team produced a new image with much more detail of the earth layers under Atlantis.

“It wasn’t until I saw the image – I thought I might be on to something,” said Shen, 32.

BP double-checked Shen’s work. Via traditional methods, such analysis would require at least a year of painstaking data comparison for geophysicists. Shen and his team did it in little more than two weeks, and created a much more accurate model.

“It produced the best image of the field we’ve ever seen,” said Etgen, the project’s principal researcher. “We basically fell out of our chairs.”

Field opened in 1990s

BP discovered Atlantis in the late 1990s. The platform can process 200,000 barrels of oil a day. But the company didn’t feel like it knew enough to drill under the salt formations.

“We knew there was a lot of promise in this basin,” Etgen said. “Fundamentally, imaging through salt was the key to unlocking that.”

Early attempts at drilling near salt domes there were disappointing at best. BP even drilled one Atlantis well next to the very field it has now discovered, but found little oil.

As image clarity slowly improved over the years, field development progressed. “We could see part of the reservoir, without the salt distorting it, so that’s where we drilled,” said Ahmed Hashmi, BP’s chief of upstream technology.

The company began to invest heavily in supercomputing and seismic imaging. It started paying for seismic surveys over much wider swaths of the sea. And, in 2013, it opened its supercomputing center, a three-story, 110,000- square-foot building on its main Houston campus with the computing power of 100,000 laptops.

Other major oil companies are also working to solve this problem. But BP has already declared its new technology so successful, it is expanding the program into oil and gas fields worldwide, expecting to find hidden pockets of oil repeatedly. BP, which plans to announce the discovery on Thursday, is making a play to be a leader in the field and perhaps even market and sell some of the technology.

The company is now assessing how to start drilling in the new field at Atlantis. Bernard Looney, chief executive of BP’s upstream business, said earlier this year that Atlantis could be ready for a third phase.


14 Comments on "BP finds hidden trove of oil in Gulf of Mexico"

  1. Ghung on Fri, 28th Apr 2017 9:21 am 

    About 10 days of US consumption? That’s quite a “trove”, eh?

  2. Cloggie on Fri, 28th Apr 2017 9:36 am 

    36 of these news items more and we have 2017 covered, well for the US at least.

  3. Apneaman on Fri, 28th Apr 2017 10:04 am 

    Chron. Another Cancer industry bitch.

  4. Apneaman on Fri, 28th Apr 2017 10:08 am 

    Even the Economist gets it.

    Climate change – The Arctic as it is known today is almost certainly gone

    On current trends, the Arctic will be ice-free in summer by 2040

    “THOSE who doubt the power of human beings to change Earth’s climate should look to the Arctic, and shiver. There is no need to pore over records of temperatures and atmospheric carbon-dioxide concentrations. The process is starkly visible in the shrinkage of the ice that covers the Arctic ocean. In the past 30 years, the minimum coverage of summer ice has fallen by half; its volume has fallen by three-quarters. On current trends, the Arctic ocean will be largely ice-free in summer by 2040.”

    It’ll be ice free earlier than 2040.

  5. rockman on Fri, 28th Apr 2017 11:33 am 

    More total bullshit. We’ve getting seismic data from below salt for more then 20 years. The last Deep Water GOM the Rockman sat on a well that drilled thru 30,000′ of salt (a record) about 10 years ago. Unfortunately after drilling the projected trap at 32,000′ the well was plugged: a $154 million dry hole.

    As far as shooting seismic successfully near salt domes that’s been done for more then 40 years. In fact many of the Gulf Coast Basin biggest fields fields were major discoveries.

  6. bobinget on Fri, 28th Apr 2017 12:39 pm 

    The oil industry only found 2.4 billion barrels of oil last year, the smallest annual figure ever recorded, the International Energy Agency said Thursday.

    The Paris-based group, which advises oil-importing countries, said last year’s small number of oil discoveries compares to an average 9 billion barrels discovered each year between 2000 and 2015.

    Energy companies also sanctioned the smallest number of conventional oil projects in more than seven decades, approving just 4.7 billion barrels for development, nearly a third lower than the previous year.

    Meanwhile, the IEA expects global oil demand to increase 1.2 million barrels a day each year over the next half decade, which the group believes could eventually flip the oil market on its head, with demand rising above supply in a few years.

    The IEA has argued even the U.S. shale industry, which is expected to balloon domestic production up to about 10 million barrels a day by the end of next year, can’t fill the looming supply gap.

    “Every new piece of evidence points to a two-speed oil market, with new activity at a historic low on the conventional side contrasted by remarkable growth in U.S. shale production,” IEA executive director Fatih Birol said in a written statement.

    “The key question,” he said, “is how long can a surge in U.S. shale supplies make up for the slow pace of growth elsewhere in the oil sector.”

    Offshore projects made up only 13 percent of all the new ventures approved by oil companies last year, down from an average 40 percent over the previous decade and a half, the IEA said “

  7. bobinget on Fri, 28th Apr 2017 1:02 pm 

    Shale poops early. Best solution? Drill more shale.
    Investors, banks, run out of interest. unless there’s money to be made.

    With most of known ‘sweet spots’ gone, few can make money @ $50.

    Result: if shale can return ten million p/d we can afford to shake ME and N.African suppliers. They, OTOH, will
    sell crude to Asia for as long as ‘they’ are allowed to export.

    With South America in Asian hands, the US now dependent on Canada for that 10 Million Barrels we have come to depend on. (3.4 MM b p/d)
    Even if Canada could come up with another half million p/d we will still be looking round for 6.6 MM p/d +/-

    Local oil shortages inspire electric vehicle buying.
    More electrics inspire more Chinese solar and Danish and German wind turbines. So it goes.

  8. Boat on Fri, 28th Apr 2017 5:02 pm 


    US shale has grown more than 800,000 bpd in the last 8 months suggesting there are plenty of hot spots.
    The US imports a net 5mbpd.

    Gross imports of oil and petroleum products is around 10 Mbpd. That means around 1/2 of imports gets resold. The US has some of the best refineries in the world that allows them to buy heavy cheap oil, mix it with US light oil, refine it and make a profit.

    This link shows the numbers if you can read data and charts.

  9. Anonymouse on Fri, 28th Apr 2017 5:04 pm 

    If anyone is interested extracting this, ahem, ‘trove’, I suggest letting anyone but BP do the work. I heard BP’s record in the GoM is a little spotty, something to do with drilling for oil and some kind of spill, or something like that?

  10. Boat on Fri, 28th Apr 2017 5:06 pm 


    PS, there is no oil shortage local or global, you merely have to pay got it. In fact the world has been in a glut. Storage volumes are at historical highs.

  11. Go Speed Racer on Fri, 28th Apr 2017 5:56 pm 

    Should be enough oil to keep the Jack In The Box
    deep fryers topped off, for about six months or so.

  12. deadlykillerbeaz on Sat, 29th Apr 2017 9:29 am 

    I wish I had an extra 200,000,000 barrels of oil somewhere in the ground or under the sea. Don’t know what I would do with it all, but somebody would be willing to buy it!

    Times fifty dollars per barrel is one million dollars! Am I wrong?

    You’d be rich!

    For a world that is supposed to kick the fossil fuel habit, the jonesin’ continues unabated for those two finite resources to produce usable energy.

    Ain’t that sumthun?

    I guess the habit for oil will disappear after those old fossil fuels are gone and gone for good.

  13. newfie on Sat, 29th Apr 2017 9:58 am 

    200 million barrels of oil. 2 days of world consumption.

  14. Go Speed Racer on Sat, 29th Apr 2017 3:47 pm 

    “200 Million” times “fifty dollars per barrel”
    equals 1 Billion dollars.
    Not 1 Million dollars.

    However, if you are Rex Tillerson, 200 Million x 50 = 75 Billion, or 5 years of his annual salary.

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