The Future of the Oil Industry: Part 1

THE FUTURE OF THE OIL INDUSTRY
PART 1: Petroleum? What is it?

The word Petroleum comes from the Greek words Petra and Oleum, meaning rock oil. It’s also known as crude oil, naphta and black gold. Petroleum is an important primary energy source, and is also raw material for plastics, solvents, pesticides and other chemical products.

There are many theories explaining the origins of the Petroleum, but let’s stick to the one that’s the favorite of most geologists. According to them, ancient vegetation and prehistoric animals’ remains were compressed and heated over millions of years under thick sedimentary layers of material, metamorphosing first into a waxy material (the kerogen), and then into oil. This oil accumulated into porous rocks forming reservoirs or oil fields, from which the liquids are recovered.

Once we find one of those oil fields, the extraction stage starts. With the help of highly specialized equipment we drill wells until we reach the reservoir. If the pressure is high enough, petroleum will flow by itself without the help of any pumping work. This is called primary oil recovery, and usually we can extract up to 20% of the total volume this way.

When the pressure drops, we need to either install a pump inside the reservoir, or to inject water or gas to maintain pressure. This is called secondary oil recovery and we can get an additional 5 to 15% of petroleum from the field.

Tertiary oil recovery will reduce petroleum’s viscosity in order to pump more of it. There are many techniques to do this but, as they all are very expensive, they won’t be applied unless the oil price is high enough to compensate the costs. Tertiary recovery allows another 5% to 15% of the reservoir's oil to be recovered.

So far, we don’t have either the means or the expertise to recover a full 100% of the petroleum of any given oil field.

What happens to petroleum once extracted?

Once extracted, petroleum goes into refineries where it is boiled to separate the different phases. Basically we heat the petroleum to a temperature where all the light gases (methane, ethane, propane, etc.) evaporate, so we can take and store them. After this, we raise the temperature a little bit more, and we get gasoline. After all of it is stored, we repeat the cycle and we get jet fuel, kerosene, diesel, gasoil, paraffin wax and finally asphalt.

So, we use petroleum just as a fuel, to build roads, and to make plastics. Don’t we?

Even if it’s not easy to see, oil provides more energy than we can imagine, and it’s therefore a substantial part of almost any given human activity. According to Dale Allen Pfeiffer, in the United States 400 gallons of oil equivalents are expended annually to feed each American (as of data provided in 1994). Agricultural energy consumption is broken down as follows:

• 31% for the manufacture of inorganic fertilizer
• 19% for the operation of field machinery
• 16% for transportation
• 13% for irrigation
• 08% for raising livestock (not including livestock feed)
• 05% for crop drying
• 05% for pesticide production
• 08% miscellaneous

If we consider the additional energy we spend on packaging, refrigeration, transportation to retail outlets, and household cooking, we’ll see that we spend nearly 10 calories of fossil fuels to produce 1 calorie of food eaten!

But we’re not talking only about food…

• The construction of an average car consumes the energy equivalent of approximately 27-54 barrels, which equates to 1,100-2,200 gallons, of oil. Ultimately, the construction of a car will consume an amount of fossil fuels equivalent to twice the car’s final weight
• The production of one gram of microchips consumes 630 grams of fossil fuels. According to the American Chemical Society, the construction of single 32 megabyte DRAM chip requires 3.5 pounds of fossil fuels in addition to 70.5 pounds of water
• The construction of the average desktop computer consumes ten times its weight in fossil fuels
• The Environmental Literacy Council tells us that due to the "purity and sophistication of materials (needed for) a microchip, the energy used in producing nine or ten computers is enough to produce an automobile"

Being our society so dependant on petroleum, we can understand why it is called black gold, why everybody is following with much interest the fluctuations of its price, and why many people are getting desperate after it has surpassed the 50 dollar per barrel barrier. Of course we can understand also why so many wars have been ignited on its name...


Please stay tuned for Part 2. We're going to try to answer the questions: is petroleum an infinite resource? Are we running out of petroleum? Are petroleum companies really pushing prices up?

See you here soon!
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Some of the data mentioned here was obtained from the following sources, and you’re invited to visit their pages:
- Wikipedia (Petroleum)
- Shell Exploration & Production
- Eating Fossil Fuels
- Life After the Oil Crash
- American Petroleum Institute
- US Energy Information Administration