Author Topic: The Shale Revolution and the Great Crew Change  (Read 311 times)

0 Members and 1 Guest are viewing this topic.

Offline thackney

  • Hero Member
  • ****
  • Posts: 3,644
The Shale Revolution and the Great Crew Change
« on: August 08, 2017, 02:54:52 PM »
The Shale Revolution and the Great Crew Change
http://www.rigzone.com/news/oil_gas/a/151302/The_Shale_Revolution_and_the_Great_Crew_Change
August 07, 2017

We have heard about the "Great Crew Change" ad nauseum for the past four or five years as the Baby Boomers (count me in that camp) reach retirement age and depart for greener pastures—sitting on a rocker, traveling the world or playing with the grandkids. And they will leave a void when they're gone, it just won't show up for a few years. The Shale Revolution will mask its impact for now, maybe for another generation.

Let's see what skills are required of a geoscientist (and I'm sorry, I'm prejudiced about the importance of geoscientists and where they fit into this work flow) in a "shale" play. They are asked to identify the "sweet spots" of a play area using whatever tools are most appropriate—3D seismic attribute analysis, surface geochem, petrophysical analysis (to determine OOIP), lineament analysis and so forth—then put a horizontal well bore in the most favorable horizon the target formation pointed in the best direction that spacing requirements allow. Then they consult with the completion team to ensure that the wellbore is optimally stimulated to produce at the maximum commercial return. Then they go do it again, and again, and again, until they have drilled up and re-fraced the 3,200 locations that they have identified in that county.

This is all good, these are technologies and techniques that can be learned by most college graduates with a basic understanding of earth science and economics. The company will make money, a good return on their investment dollar, and they will survive. But they may not survive when they run out of shale wells to drill in that county. And it could be (successfully) argued that the Shale Revolution has saved the domestic oil industry from the effects of the last Great Crew Change by allowing them to survive without Exploration.

What, you thought this was a new thing? It's not, and as George Santayana once wrote, "Those who cannot remember the past are condemned to repeat it." During the late 1970s and early 1980s there was an older generation that found a lot of oil (Elmworth (1976), Prudhoe Bay (1968), Ekofisk (1969) and East Anschutz Ranch (1978), to name but a few) and went into retirement with the crash in prices (I remember when we sold a tank of sweet crude in the Gulf Coast for $20/barrel and were happy that the price was that good). I've never seen any figures, but I rather suspect that we lost proportionately as many as we have over the past few years.

The upstream industry back then was divided into two camps, development and exploration. Development was detailed and busy. You were charged with drilling wells to fully exploit an accumulation. Not no risk, but low risk. If you needed seismic, you got seismic. That's where the bulk of any company's budget that wanted to survive went. They were the bread and butter of the day.

Exploration was the opposite. You got relatively little budget because it was a sure bet you were going to drill a bunch of dry holes and "waste" it. Successes were few and far between and the learning curve was steep and easy to fall off of. Risk was the elephant in the room that nobody wanted to talk about but everybody had to figure out how to manage. New technology helped—it's not likely the Wyoming overthrust would have been found without CDP seismic or the Sacramento Valley Gas Province exploited without recognizing "bright spots" for what they were. Of course, there were over a hundred dry holes drilled in each of those plays (and countless others) before they broke open.

And then tight gas came along (helped by some favorable taxation), followed by shale gas, coal bed methane and now tight oil. These are all technology-driven, continuous-type reservoirs, most of which had been previously identified by vertical wells that encountered shows while drilling. This was great!! Little geologic risk, if you managed things right. They satisfied every manager's dream of repeatable mini-projects that were similar enough that you could book 'em before you drilled 'em. It became an issue of managing company resources (capital and people) to maximize the return on investment. Good managers became the rock stars, and the investment community their biggest fans.

And in the process the explorationists that were around slowly and inexorably disappeared—without leaving a new crop to carry on. And, just for the record, geologists don't always make the best explorationists. Engineers, geophysicists, even managers make great explorationists because they have "that something." Great explorationists share a few common qualities and traits: they're not afraid of hard work, they pay attention to (but don't get lost in) the details, they love what they do, and they persist until they drive everyone around them nuts. And, perhaps most importantly, they have learned what maps matter....
« Last Edit: August 08, 2017, 02:55:16 PM by thackney »
Life is fragile, handle with prayer

Online IsailedawayfromFR

  • Hero Member
  • ****
  • Posts: 4,699
  • Sept 11 2001 or March 6 1836
Re: The Shale Revolution and the Great Crew Change
« Reply #1 on: August 09, 2017, 09:25:58 AM »
True words.

I worked Exploration as an engineer for a number of years supporting a team of Geoscientists on a world-wide basis.  They are almost all now retired or pushed out by the wave of unconventional developers.

It will be difficult to cultivate the depth of understanding that an Exploration Geo has in the future.

The shock will come when the next generation is forced to rely upon Explorationists sourced from international venues for the expertise to conduct true exploration in this country.
Yearning to stay free takes place in many ways at many different times, whether by withstanding planes or bayonets

Online IsailedawayfromFR

  • Hero Member
  • ****
  • Posts: 4,699
  • Sept 11 2001 or March 6 1836
Re: The Shale Revolution and the Great Crew Change
« Reply #2 on: August 11, 2017, 10:48:30 AM »
@Smokin Joe

Surprised you have not commented on this topic, as I suspect you might be one of the crew change going out in short order.

In fact, I haven't seen any postings by you in awhile.
Yearning to stay free takes place in many ways at many different times, whether by withstanding planes or bayonets

Offline Smokin Joe

  • Member
  • Hero Member
  • ****
  • Posts: 16,438
  • The light at the end of the tunnel.
Re: The Shale Revolution and the Great Crew Change
« Reply #3 on: August 11, 2017, 01:38:38 PM »
@Smokin Joe

Surprised you have not commented on this topic, as I suspect you might be one of the crew change going out in short order.

In fact, I haven't seen any postings by you in awhile.
Sorry. I have been on the road and off line for a little while. I'll give the article a look.
How God must weep at humans' folly! Stand fast! God knows what he is doing!
Seventeen Techniques for Truth Suppression
And I looked, and rose up, and said unto the nobles, and to the rulers, and to the rest of the people, Be not ye afraid of them: remember the Lord, which is great and terrible, and fight for your brethren, your sons, and your daughters, your wives, and your houses. Nehemiah 4:14 (KJV)

About the only "Big" Liberals don't revile is "Big Government"

Offline Smokin Joe

  • Member
  • Hero Member
  • ****
  • Posts: 16,438
  • The light at the end of the tunnel.
Re: The Shale Revolution and the Great Crew Change
« Reply #4 on: August 11, 2017, 01:54:50 PM »
@Smokin Joe

Surprised you have not commented on this topic, as I suspect you might be one of the crew change going out in short order.

In fact, I haven't seen any postings by you in awhile.
It has been far too long since I worked a vertical well looking for something new. That was my favorite part. I told the 'guys in Denver' for an oil company I was working for, "You have what two other companies are looking for, in this well" at the edge of what was to become the Elm Coulee Field, and maybe worked one vertical well since. That was the part I loved, finding oil. I have a few good years left, but with the emphasis on development have my doubts I will be able to find something like that again. (That well was an in field discovery in another formation as well).
The hardest part is that for those of us who worked in the field under guys in offices far, far away, is that those guys have retired, and the new folks moving in either don't know you or what you have done, or don't care about that because they are intent on developing what is on the table now. The company I found oil for back when was sold to a bigger outfit, and that company subsequently bought by a major, whose office people had an entirely different attitude toward contractor field personnel once the surviving original personnel had been retired.
How God must weep at humans' folly! Stand fast! God knows what he is doing!
Seventeen Techniques for Truth Suppression
And I looked, and rose up, and said unto the nobles, and to the rulers, and to the rest of the people, Be not ye afraid of them: remember the Lord, which is great and terrible, and fight for your brethren, your sons, and your daughters, your wives, and your houses. Nehemiah 4:14 (KJV)

About the only "Big" Liberals don't revile is "Big Government"

Offline truth_seeker

  • Hero Member
  • ****
  • Posts: 18,810
  • Common Sense Results Oriented Conservative Veteran
    • The place where argument addicts can go
Re: The Shale Revolution and the Great Crew Change
« Reply #5 on: August 11, 2017, 01:58:28 PM »
While I was finishing college, I worked as assistant to two fellows, a reservoir engineer, and a geologist, both master degrees, on secondary recovery projects.

from this article, this stood out to me:

"Great explorationists share a few common qualities and traits: they're not afraid of hard work, they pay attention to (but don't get lost in) the details, they love what they do, and they persist until they drive everyone around them nuts. And, perhaps most importantly, they have learned what maps matter...."

Among the experiences, which led me to become "results oriented, and common sense."

"God must love the common man, he made so many of them.”

Abe Lincoln

Online IsailedawayfromFR

  • Hero Member
  • ****
  • Posts: 4,699
  • Sept 11 2001 or March 6 1836
Re: The Shale Revolution and the Great Crew Change
« Reply #6 on: August 11, 2017, 02:11:55 PM »
While I was finishing college, I worked as assistant to two fellows, a reservoir engineer, and a geologist, both master degrees, on secondary recovery projects.

from this article, this stood out to me:

"Great explorationists share a few common qualities and traits: they're not afraid of hard work, they pay attention to (but don't get lost in) the details, they love what they do, and they persist until they drive everyone around them nuts. And, perhaps most importantly, they have learned what maps matter...."

Among the experiences, which led me to become "results oriented, and common sense."
Keen observation.

I was waiting for @Smokin Joe to comment a couple of sentences prior to that

Quote
And in the process the explorationists that were around slowly and inexorably disappeared—without leaving a new crop to carry on. And, just for the record, geologists don't always make the best explorationists.
Yearning to stay free takes place in many ways at many different times, whether by withstanding planes or bayonets

Offline Smokin Joe

  • Member
  • Hero Member
  • ****
  • Posts: 16,438
  • The light at the end of the tunnel.
Re: The Shale Revolution and the Great Crew Change
« Reply #7 on: August 11, 2017, 04:31:59 PM »
Keen observation.

I was waiting for @Smokin Joe to comment a couple of sentences prior to that
The trick is knowing which details matter, and why. I have seen people go off on tangents about this or that, but the bottom line is the question of whether or not there is oil there, in economically recoverable quantities, and then, how extensive the reservoir is.

How God must weep at humans' folly! Stand fast! God knows what he is doing!
Seventeen Techniques for Truth Suppression
And I looked, and rose up, and said unto the nobles, and to the rulers, and to the rest of the people, Be not ye afraid of them: remember the Lord, which is great and terrible, and fight for your brethren, your sons, and your daughters, your wives, and your houses. Nehemiah 4:14 (KJV)

About the only "Big" Liberals don't revile is "Big Government"

Online IsailedawayfromFR

  • Hero Member
  • ****
  • Posts: 4,699
  • Sept 11 2001 or March 6 1836
Re: The Shale Revolution and the Great Crew Change
« Reply #8 on: August 11, 2017, 04:57:59 PM »
The trick is knowing which details matter, and why. I have seen people go off on tangents about this or that, but the bottom line is the question of whether or not there is oil there, in economically recoverable quantities, and then, how extensive the reservoir is.
I'll add my statistician bent and say "question of whether or not likelhood there is oil there".
Yearning to stay free takes place in many ways at many different times, whether by withstanding planes or bayonets

Offline Smokin Joe

  • Member
  • Hero Member
  • ****
  • Posts: 16,438
  • The light at the end of the tunnel.
Re: The Shale Revolution and the Great Crew Change
« Reply #9 on: August 11, 2017, 05:24:14 PM »
I'll add my statistician bent and say "question of whether or not likelhood there is oil there".
You may, but I'm a field guy. I'm a veteran of 224 wellsites, and when you are looking at the rock, it is there or it isn't (except the Interlake, which is tougher to evaluate. If you got a gas show on a closed structure that hasn't been tested, test it--it's the only way to know.

The hard part is in overcoming prejudices about which formations will or won't produce (Why the Lodgepole was almost missed).
I had one company tell me their computer told them we were not looking at oil because it wasn't there (according to the computer). This was an exploration division well, and they were so sure their computer was right we drilled for another 30 days to the zone the computer told them had oil. It didn't. They plugged back to the one we had found, got the strap wrong, and straddle tested the wrong zone, which fed the "I told you so" we got from the office. The zone was never tested, now being behind a plug.
Another (production division of the same company), tested a show in a zone which was 'not supposed to be present', and made a well.  The anticipated target wasn't developed. Carbonates are less predictable as a rule, and the oil is where you find it.
One more: a small independent company had processed their seismic and come up with a group of structural highs which, as it turned out were not. When they said they were going to find out why those highs showed and correct it, I reminded them that high or not, every well drilled which had shown as a 'high' was a producer, whether it was structurally high or not (and most were not) when we drilled it. Maybe changing that wasn't such a good idea; after all, this was working. (If it ain't broke, don't fix it.)
How God must weep at humans' folly! Stand fast! God knows what he is doing!
Seventeen Techniques for Truth Suppression
And I looked, and rose up, and said unto the nobles, and to the rulers, and to the rest of the people, Be not ye afraid of them: remember the Lord, which is great and terrible, and fight for your brethren, your sons, and your daughters, your wives, and your houses. Nehemiah 4:14 (KJV)

About the only "Big" Liberals don't revile is "Big Government"

Offline Bigun

  • Hero Member
  • ****
  • Posts: 23,306
  • The income tax: Root of all evil!
    • The FairTax Plan
Re: The Shale Revolution and the Great Crew Change
« Reply #10 on: August 11, 2017, 06:15:59 PM »
The trick is knowing which details matter, and why. I have seen people go off on tangents about this or that, but the bottom line is the question of whether or not there is oil there, in economically recoverable quantities, and then, how extensive the reservoir is.

Followed closely by "can we economicly get at it?"
« Last Edit: August 11, 2017, 06:16:26 PM by Bigun »

Online IsailedawayfromFR

  • Hero Member
  • ****
  • Posts: 4,699
  • Sept 11 2001 or March 6 1836
Re: The Shale Revolution and the Great Crew Change
« Reply #11 on: August 12, 2017, 03:09:37 PM »

One more: a small independent company had processed their seismic and come up with a group of structural highs which, as it turned out were not. When they said they were going to find out why those highs showed and correct it, I reminded them that high or not, every well drilled which had shown as a 'high' was a producer, whether it was structurally high or not (and most were not) when we drilled it. Maybe changing that wasn't such a good idea; after all, this was working. (If it ain't broke, don't fix it.)
For some strange reason, the company I worked for decided to train some of its engineers in geophysics, so I was one for a few months.

During the month I spent as a processor, I was able to build structural highs that looked convincing.

Ever since, call me a skeptic.
Yearning to stay free takes place in many ways at many different times, whether by withstanding planes or bayonets


Share me

Digg  Facebook  SlashDot  Delicious  Technorati  Twitter  Google  Yahoo
Smf