Expanded Oil Drilling

					Petroleum Geography
Introduction
 Terminology:
    Proved: Has at least a 90% probability that the all of the
     claimed amount of oil can be recovered
    Unproved: Has lower than 90% of certainty
        Probable: 50% or higher degree of accuracy
        Possible: 10% or higher degree of accuracy
 On shore petroleum deposits:
   66.5 BBO proven, 115.1 BBO unproven
 Off shore petroleum deposits:
   21.1 BBO proven, 48.5 BBO unproven
On Shore Petroleum Deposits
 Continental oil
reserves mainly lie
in Southern California,
Texas, Alaska, and
Montana/North Dakota
 Williston Basin in
Montana has largest
continental supply
 Alaska has largest overall supply of oil by far.
  Accounts for 53% of total land oil
Off Shore Petroleum Deposits
 The largest oil reserves
located in the Gulf of Mexico
 Second largest located
in the shelf off Alaska
 Majority of oil available is
located off-shore (73%)
Total Results
 In total (Both off shore and on shore)
    Proven: 87.6 BBOs
    Unproven: 163.6 BBOs
 Since the majority of oil is located offshore, more focus
  should be placed here.
 In terms of on-shore reserves, Alaska has the highest
  quantities of oil, but is located in sensitive regions
  near wildlife.
 Important to remember that the quantities given only
  account for the known deposits
Economic Implications
Economic Background
 Current recession
 Cost to taxpayers
 Oil companies posting huge profits
 Top Ten Corporate Quarterly Earnings of all Time
        Place Company           Year   Quarter   Dollars (USD)
        1    Exxon Mobil Corp   2008 2           $11.68 billion

        2    Exxon Mobil Corp   2007 4           $11.66 billion

        3    Exxon Mobil Corp   2008 1           $10.89 billion

        4    Exxon Mobil Corp   2005 4           $10.71 billion

        5    Exxon Mobil Corp   2006 3           $10.49 billion

        6    Exxon Mobil Corp   2006 2           $10.36 billion

        7    Exxon Mobil Corp   2007 2           $10.26 billion

        8    Exxon Mobil Corp   2006 4           $10.25 billion

        9    Exxon Mobil Corp   2005 3           $9.92 billion

        10   Exxon Mobil Corp   2007 3           $9.41 billion
Economic Benefits
 Cheaper gas
    Will it really happen?
    If so, by how much?
    More disposable income?
 Job creation
    Current record unemployment
 Tax revenue
 Lower dependence on foreign oil
    Shrink trade deficit
Economic Drawbacks
 Will alternative energy still be a priority with cheaper
  gas or more abundant oil?
 Too early to tell
Environmental Issues
Environmental Ethics
 Human-Centered Ethics
 Sentient-Centered Ethics
 Biocentric Ethics
 Ecocentric Ethics
Oil Spills - Sources
 Natural Oil Seepage: 47.3%
 Extraction/Drilling of Oil: 2.9%
 Transportation by Tankers
           – Accidental Spills: 9.8%
                 – Normal Operations: 24.1%
 Consumption
           – Air Pollution: 4.2%
           – Runoff From Land Sources: 11%
           – Jettisoned Fuel: 0.6%
Oil Spills – Historical Evidences
 Santa Barbara’s 1969 Oil Spill
       200,000 gallons of oil spilled in
        the ocean.
       It took 12 days to control the
        leakage.
Oil Spills – Historical Evidences
 Exxon Valdez, 1989 oil spill
       11,000,000 gallons of oil spilled in the ocean.
       It took weeks to clean up.
Marine and Wildlife
 Suffocates Plants and Animals
       Clogs the blowholes of the dolphins.
       Kills vegetations that marine animals live on.
 Suppresses The Health of Marine and Wildlife
       Ingestion and inhalation of oil harms marine life.
       Effects on breeding, growth, and the toxin can cause cancer
        and other illnesses.
Effects on Scenery


                                                                   BEACH
  Offshore drilling “will threaten to shut down our favorite beaches
  with oil spills, pollution, and invasive infrastructure.”
  Protect Our Coasts




 Miles away from the beaches
 Onshore pipelines could be
  covered
Solutions
 Regulation and Enforcement
       Stricter requirement on technology.
       Enforcement of better emergency
        response.
 Alternative Fuels
       Long term benefit.
       Can help with global warming.
 Oiled Wildlife Care
       Provide better care for oiled wildlife.
Obama – What Could Be
            • Supports a government
                regulated system for oil
                drilling.
            •   Very limited offshore drilling.
            •   Highly affected by public
                opinion, originally not
                interested in offshore drilling.
            •   Supporter to alternative fuels.
            •   Doesn’t feel it is a complete
                immediate solution.
McCain – What Could Have Been
• Supported offshore drilling from
  day one.
• Less inclined for total
  government regulation of
  drilling.
• Feels it will be an immediate, but
  impermanent cure to the oil price
  problems.
• Definitely follows the
  contemporary republican
  philosophy.
Public Interest
                   Lower oil prices
                    are on the mind.
                   Consensus that
                    oil prices were
                    outrageous.
                   Desperation
 Public Opinion
• Wants a quick solution to the oil
  price issue.
• Recent polls suggest that the
  public is in support offshore
  drilling.
• The majority is only slightly
  bigger than the minority on this
  issue.
• People tend to support the idea
  of alternative energies, but there
  is still a large group of people
  who feel it is not a viable option
  at this point in time.
Drilling Regulations
Oil Drilling Regulations
          Pros                          Cons
 Ensure protection of the    Increases time and cost
  public and environment       of production
 Mediates barrel pricing     Puts a constraint on free
 Enforces adherence to        market policy
  proper maintenance and      Limits access to domestic
  procedures                   deposits
                              May raise cost of gas at
                               the pump
BP Texas Bay Explosion
                 On March 23, 2005 a Texas
                  City Refinery exploded
                 15 lives were lost and over
                  180 were injured
                 Could have been avoided
                  had work order been
                  executed on time
                 People died because
                  control trailers were too
                  close
Lake Erie Polluted
 Roughly 51 oil spills
  occurred in the Canadian
  territory of Lake Erie
  between 1997 and 2001
 Amount and duration of
  spills remain undisclosed
  by Canadian Government
 Techniques for drilling
  were still too dangerous for
  environment
 As a result, oil drilling was
  banned in the U.S. parts of
  the great lakes
Will Alaska be Next?



 BP has already been charged with spilling over
  200,000 tonnes of petroleum in Alaska through
  corroded pipelines
 Should they or others be allowed to tap into the oil
  rich wild reserve known as the Artic National
  Wildlife Refuge (ANWR)?
How about Market Control?
               Exxon Mobil posted a
                record $40 billion profit in
                2006
               Exxon Valdez spill in 1989
                required $4.5 billion
                settlement from Exxon
               Exxon refused to pay
                saying that the $3.5 billion
                clean up was sufficient and
                that they couldn’t afford to
                pay anymore
What should be done?
 From the examples of
  leading oil companies,
  they cannot be trusted
  to keep themselves
  accountable
 Domestic drilling
  needs regulations with
  strict watchdogs to
  enforce them
 Yes, domestic drilling can lead to an economic
  boom
 Yet at what cost is the U.S. willing to pay for this?
 How can the people keep the oil companies in
  check?
 Regulations are a must
Technology of Oil Drilling
Technology of Oil Drilling
 A rough, dirty, and risky job
 Basic technology of an Oil
  Rig
 Many connections of pipe
  and a drill bit for digging
 Everything is really
  dependent on pressure from
  “mud” going down the pipes
 The only indicators on an oil
  rig are really just pressure
  gauges
Santa Barbara
 The biggest influence on the safety standards in the
  United States for oil drilling onshore and especially
  offshore was the Santa Barbara Oil Spill
 On January 29, 1969, a Union Oil Co. started spilling
  out gallons of crude oil from a the 3500 feet deep oil
  well of the oil rig platform six miles off the coast of
  Summerland in Santa Barbara, CA
 During the 11 days it took for oil workers to solve the
  problem and cap the rupture, 200,000 gallons of
  crude oil floated onto the surface of the ocean and
  spread out about 800 square miles
What caused the oil spill?
 After some investigation, it turns out that the oil
  riggers were retrieving the pipe in order to replace a
  drill bit.
 While replacing the bit, “mud” is usually applied to
  maintain pressure.
 In this case, the pressure became dangerously low
  and a natural gas blowout occurred.
 The pressure created expansion in the Earth, which
  expanded the mass and created five breaks in an
  east-west fault on the ocean floor.
 From this point, oil and gas came out from the Earth
  and bubbled up to the surface
Conclusion: Tech is Important!!
 From the 1969 Santa Barbara Spill, the United
  States learned about the risks of oil drilling
 Based upon what immediately caused the oil spill, it
  was all technology
 More regulation needed
 More safety-guards on the oil rigs
 Less ease of being able to drill on sites, especially
  those offshore
 The only way offshore drilling would be later
  approved is if it could be proved from a technical
  standpoint that oil spilling disasters can be prevented
Oil Drilling and its Bad Rep
 Technology has not changed much over half a century
 A few improvements for preventing accidents on oil rigs
      - Different Drilling Methods (e.g. Horizontal)
      - Satellite imaging
      - Seismic indicators
 Main concerns:
      - Time and cost put into the technology
      - Accuracy and maintenance
      - Overall Risks: Especially Environmental
      - Improvements that can be made?

				
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posted:8/22/2012
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