New Tools for Understanding Shale -- The Economy Re-igniter

Finding Petroleum
North American shale oil & gas are considered a chance for re-igniting the US economy -- if the US political establishment will allow it to happen.

Shale is where gas is actually created. Energy men call it “the kitchen,” where hydrocarbons “cook,” and where large amounts of gas remains trapped. [George P.] Mitchell wondered: Why not drill all the way down to the kitchen? His exploration company probed the Barnett Shale, a slab sprawling 7,000 feet beneath Dallas and Fort Worth. Competitors scoffed. “We we running low on gas, and I had to find another reservoir somewhere,” Mitchell, now 92, told Bloomberg News. “So I said let’s drill a well and see what this thing is about.”

He invested his faith and capital in hydraulic fracturing, which had been introduced in rudimentary form in the late ’40s. Injected at enormous pressures and in huge volumes, fracking fluid creates narrow cracks in the shale. Sand diffused in the fluid stays behind and props open the cracks, allowing gas to flow out and up through the well. “Mitchell Energy,” the industry consultant Daniel Yergin writes in his new book, The Quest: Energy, Security, and the Remaking of the Modern World, “cracked the code.”

In 2002, after 60 years in the business, George Mitchell decided to cash out. Devon Energy (DVN), a better-capitalized independent in Oklahoma City, acquired his company for $3.5 billion. Devon brought to the Barnett a knack for horizontal drilling. Improvements in equipment controls and measurement methods allowed its crews to drill down and then turn the gnawing diamond-tipped bit sideways. Drillers penetrate the shale laterally rather than just vertically. This exposes more of the surface area of the formation to extraction and enables multiple wells to be created from each drill pad. _BusinessWeek

But not all shales contain the same amount of oil & gas. And even a promising shale might ruin an oil & gas company if they went about drilling it the wrong way. You have to know where to drill, what frac fluids to use, and what direction and depth to turn your drill.

A company called Paradigm specialises in subsurface software for integrating seismic and log data to help you find the best place and way to drill your shale. The image at the top is an example of how Paradigm's tools integrate geoscience information to help drillers.

Other crucial information about a shale can be obtained via micro-structural and nanoscale imaging.

These tools not only tell you where the oil & gas are likely to be, but how much petroleum is in place, how much you are likely to be able to get out, and which method is likely to be most effective.

The technology has come quite a ways since George P. Mitchell pioneered hydraulic fracturing and Devon Energy improved horizontal drilling methods. A higher proportion of wells are likely to be producing wells, making the process more efficient and profitable. And this technology has just gotten started.

Can shale oil & gas re-ignite the US economy? As long as the US and state governments allow oil companies to work, shale energy is likely to boost those economies for a number of decades.