I have friends, who are almost family in Alaska. The sought-after and coveted Permanent [Oil] Fund (PF) checks have paid for a lot of essentials, not just broken-down snow machines commonly found around homes in the northwestern areas of the state. That fund was wisely (?) started in the 1950s when the political fathers of Seward concluded that the small population within Alaska at that time could use a boost in income from the aggressive exploration and production occurring.
The people voted themselves access to the state treasury in 1976. Alaska Permanent Fund Corporation was formally established in 1980. Fund checks are sent, based on years in Alaska, starting from the first eligibility. The idea was to create and transfer wealth intergenerationally. Today, we hear politicians talk about using it for renewables. One of those friends went to Alaska right after the Korean war. He still gets those shared revenue distributions from extraction-derived mineral severance taxes.
RPSEA finance modeled after PF. The same idea was used when Rep. Tom Delay (R – Texas) created RPSEA. A small portion of royalty revenue from federal land and waters was put back into E&P research. The original intent was to research the increasing of production safely; however, the Obama administration changed the mission to safety, if you must, with no concern for increasing production. RPSEA and the industry pursued novel ideas for about 10 years. That is, until a prominent Republican who replaced Tom worked with Obama to kill the program in 2015. Jobs in his state were lost. Some things never change.
My point? It is time to again embrace cost share research between government and industry to propel safety, production and technology for the discovery, extraction and beneficial use of energy. Energy that was once derived from solar, perhaps millions of years ago. Maybe we should use the DOE solar grants for practical in-your-vehicle fuel for everybody. The current President of the United States seems to understand this principle. While he is spending considerable time attempting to persuade other governments to direct policy towards more immediate benefits, the U.S. is not waiting. Nor are the many explorationists who are actively trying to replenish supply to the U.S. and allies. (Allies meaning anyone not pointing a gun or missile at the U.S. or its friends.)
Just how is the momentum going right now? Offshore, just about anywhere, is “HOT.” Alaska, from which I am writing this, is about to explode again. May I remind history that enviro-theology prevented early, safe, pipeline construction to move crude to market. That block resulted in the Valdez incident, and TV coverage of oil-covered ducks on 60-Minutes. Major oil rushed to exit ship ownership. The boring movie, Waterworld (1995), did not help either.
What exploration tech will be used this time? New and improved three-D imaging, of course. That is predated by better and significantly more usable 3D gravity and magnetic data. Basin size data, such as G&M combined with “evolved” geologic understanding, is leading to new, overlooked areas. That includes the Cook Inlet, which everybody knows is a mud hole surrounded by metamorphic and recent igneous rocks. Right? So just what are those platforms producing?
Three D seismic, the fundamental imaging tool, this time has the incredible advantage of precise location of each detector. Not just estimates, plus or minus 25 m. Combine that with mega compute-cycles and the turnaround time is 1/20th of the 1990s. The big problem, however, is too many geos rely on software to interpret and reason for them, rather than exercise true geophysical understanding and geologic thought. Experience counts, but not many folks actually have it in exploration. Our fault.
Ok, where to look? Check the detailed history of an area’s reservoir production, using the revelation of hydraulic mechanics (e.g., fracking perm revelations and new material balance calculations after so-called conventional steady state flow). The best papers have been published since 2000. After all, step-outs are booked as exploration.
Who is developing the tech?If you want to see where the technology is still under development, don’t look to China. They may be great at math and money, but they are copiers and just don’t get it. Rather, look to Aramco. Not only do about 92 million people in the area want them dead, but the royals also understand that Ghawar can’t last forever. Look at the Gulf Energy Information Excellence Awards (the World Oil upstream portion), just held in October, to see the who’s who and you will see that Aramco is putting real effort into E&P tech. It appears, in my opinion, that they are no longer just pirating the best minds in the industry but becoming some of the best minds. Congratulations! You can see some of their work in professional publications.
The religion of environmentalism is still mind-dead. Look at the issues of scorched earth the O&G folks are still being accused of. Photos today show finished E&P activity as a small bare spot the size of a house footprint, perhaps with a Christmas tree and a meter. Beware of old photos and paintings the fundraisers use for their cause. In Alaksa, Trump is not a dirty word, sort of. They would like those checks to keep coming. So would all of the free world. WO
WHTEXAS@AOL.COM / WILLIAM (BILL) HEAD is a technologist with over 40 years of experience in U.S. and international exploration.