Technology can unlock new fields, curb fears of peak oil

Technology advancements in the energy sector can boost oil and gas production, improve safety and curb fears that fossil fuels are rapidly running out, a Chevron official said today.

During the opening session of a Houston energy conference this morning, Jay Pryor, Chevron’s vice president for business development, touted a number of technology advancements that have improved the efficiency and safety of fossil fuel production, including enhanced oil recovery, 3D seismic imaging, horizontal wells, and hydraulic fracturing.

“Because of technology, we are producing in places once just dreamed of,” Pryor said, at the 10th annual KPMG Global Energy Conference. “In lifting those reserves, we’ve raised doubts about the eminence of peak oil.”

The conference, hosted by consulting firm KPMG, is being held today and tomorrow at the InterContinental Hotel.

Technology has allowed the industry to cut the cost of production, increase the volume of fossil fuels captured, reduce environmental impacts and reach previously inaccessible deposits of oil and natural gas.

Global reserves of oil and natural gas have grown 130 percent since 1980 and more than 30 percent since 2000, Pryor said.

New methods for extracting more oil and natural gas from the ground have been particularly important to growing production volumes, Pryor said.

The natural flow of oil from wells only accounts for 15 percent to 20 percent of the total volume produced today, he said. Easing the flow of fossil fuels using water, carbon dioxide and other methods can enhances production by as much as 25 percent.

“And now the combined application of horizontal drilling and fracking can add another 10 percent,” he said. “Each of these technology advances unlocks more resource and reserves.”

Deep-ocean drilling holds among the greatest promises for expanding oil and natural gas production, Pryor said. He noted that in the 1950s, the industry was limited to drilling in water depths less than 100 feet. Today, wells are being completed 10,000 feet below the ocean’s surface.

With the industry’s venture into riskier environments, public fears have grown about accidents that could harm human life and the environment, like the fatal 2010 disaster at BP’s Macondo well in the Gulf of Mexico.

Pryor said the industry must respond to the added pressure.

“We know each incident – whether it’s in the U.S. or overseas, whether it’s on land or in the water – raises fears about the safety of our industry and makes governments want to through up barriers to access worldwide,” he said. “We know that all it takes is one teaspoon of oil in the water to dampen the support of the public, the politicians and our partners.”