Southern US Offshore Drilling

A big item in the news the other week was that Chevron discovered an enormous new oil field in the Gulf of Mexico. Some news sources seemed to treat this as the Holy Grail of the energy dilemma. At this point, the impending problems with the “Peak Oil” theory have actually found their way into the mainstream conscience. A few years ago, very few people thought that declining fossil fuel supplies would be a significant problem within their lifetime. Now, many people realize that the world may be on the brink of disaster, and today’s young adults are going to face a radically different future than they expected when they were growing up.

Not too many months ago, there was a lot of interest generated when Pemex, which is Mexico’s national oil company, made a “gigantic” discovery off the coast of Mexico which some sources indicated could contain as much as 10 billion barrels of oil. That’s Billion with a “B”, not Million. Sounds like a lot, eh? Well, it would be. In fact, it would be the largest single discovery in many years. To put things in context, there are approximately 21 fields world-wide that initially contained 10 Billion or more barrels. Four of those 21 fields contained 20 Billion barrels or more, and the rest contained between 10 and 20 billion (although the Tengiz field in Kazakhstan may be a fifth that will eventually prove to have contained more than 20 billion barrels).

The problem is that the world currently consumes [probably] between 84 and 86 million barrels per day, although nobody is certain for sure. If that estimate is close to being accurate, then that adds up to about 30 billion barrels per year. So all of the fuss about the discovery of the field off the coast of Mexico last year would only, in the end, contribute about enough new oil to last the world for about four months. And this was the “find of the century.”

Interestingly, the discovery of this Mexican field came about just a few months before the Mexican parliament voted on Pemex’s annual exploration budget and drilling program. Even more interestingly, in a not-so-public announcement later in the year, it was revealed that this enormous Mexican find turned out to only be about 43 million barrels. That’s right: enough oil to last the world for about twelve hours, or enough to last the United States (the world’s largest single consumer country) for two days.

The Chevron Gulf discovery made headlines around the world because of the potential size. Early speculation suggested that it could be as large as 15 billion barrels. However, a few things need to be pointed out:
- The “discovery” was based on a single well being drilled, not a whole program.
- The well in question, nick-named “Jack,” was a record-setter because it was the deepest well ever drilled underwater, namely under 7,000 feet of water, with the drill descending another 20,000 feet.
- Costs for developing a productive field at this depth would be astronomical.
- At that depth (27,000 feet), basic geologic tenets regrettably indicate that the field would be predominantly natural gas, not oil (which of course is still useful).

It is impressive that the well was drilled successfully, and that today’s technology can overcome such challenging hurdles. However, I think some people are getting a bit too excited in thinking that this field will “end the US reliance on foreign oil.” Someone is going to have a lot of egg on their face if this field, like the Mexican one, proves to be much smaller than everyone currently hopes. Also, production will not commence from this field for several years. If the Americans truly hope to end their reliance on foreign oil, they’d better change their lifestyles pretty quickly and reduce their demand, especially for transportation, because searching for deep-ocean fields is only postponing the inevitable.

And we Canadians are just as guilty, based on our own per-capita consumption.