Noted today over at LATOC, this is certainly worth posting again:
Saudi Aramco boosts drilling efforts to offset declining fields
"Saudi Aramco's mature crude oil fields are expected to decline at a gross average rate of 8%/year without additional maintenance and drilling, a Saudi Aramco spokesman said Tuesday.But Saudi Aramco has taken a number of measures to offset a decline in output from the country's aging oil fields, the spokesman added.
"A variety of remedial activities are always being taken in oil fields influencing their effective decline rates," the spokesman said. "The drilling of additional development wells in the producing fields is Saudi Aramco's standard practice to offset normal declines of older wells."
Saudi Aramco is the national oil company of Saudi Arabia. It's also the largest oil corporation in the world and the largest in terms of proven crude oil reserves and production. To my knowledge I don't think they've actually come out and admitted that their fields are passed their peak. I could be wrong, but I guess even if they haven't...now they have.
Decline, decline, decline.
T. Boone Pickens had this to say about decline: "I think they are on decline in the biggest oil fields in the world today and I know what it's like once you turn the corner and start declining, it's a tread mill that you just can't keep up with." I don't know whether he ever actually faced an 8% per annum decline, but if he did I bet he'd have something awfully colorful to say about it. A decline of 8% per year is a big number. 4% to 6% is more typical.
Chris Skrebowski, editor of Petroleum Review said that "as much as 70% of the world's producing oil fields are now in decline". Do you know how you offset decline? Basically you drill more. And faster. I mean if 70% of fields are in decline, and if virtually everyone admits there are no major discoveries left, wouldn't that mean we passed the Peak production/demand date quite some time ago? Actually it should--but it doesn't have to just so long as you can keep drilling more. And faster. That's what you do in a declining field, in a declining region, and that's what's happening in a declining world. In fact, Saudi Aramco plans to increase their drilling by 61% this year alone. They say it's to meet increasing demand. They don't say it's to meet declining production.
Of course faster drilling entails a host of other issues, all of which are aimed at getting the most oil out before things collapse. And just as you'd expect, when they finally DO collapse they do it very quickly. Maybe even as fast as 8% per year.
And that pretty much sums up the whole strategy our present era.
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