Oil Exploration

So, How Is Oil Found?

It all begins with oil exploration...

Petroleum geologists and engineers have established that oil, when trapped, collects into underground pools called reservoirs. It is from these reservoirs that oil is produced. So, all these geologists have to do is find the oil reservoirs and sit back and watch the oil production flow! Couldn’t be easier right? Well, not exactly.

It is said that the best place to find oil is in an oilfield. This is true, without question. But, what do you do when there is no defined oilfield, and there are no nearby wells? It sounds quite simplistic but, think about it, every major oilfield must have begun with the drilling of the field’s first well.

How did they know where to drill the well, and how did they convince their bosses that drilling that well was worth the expensive research and drilling costs? Doesn't sound so easy now, eh?

If you're thinking there's some risk to all of this, well there definitely is tremendous risk!

The industry calls these wells miles away from known production, wildcats. Depending on the results of their attempts at finding hydrocarbon, the wells are known as discovery wells or dry holes.

If the discovery well shows hydrocarbon, other development wells are drilled to confirm the find. If nothing is found, well, the operator will simply abandon the well and move on to other prospects and plays.

Through the utilization of a variety of high and low-tech tools and methodologies, today’s producing reservoirs were discovered.

The presence of oil seeps and pits at surface is a strong indication that oil may be present underground. If a trapping mechanism exists below, one may have found a reservoir.

The surface exposure (outcropping) of known source and reservoir rock suggests the right conditions for oil generation and storage may be present. If a trap of some kind were detected, it is possible that a reservoir could be discovered.

So, how do geologists detect reservoirs miles below the surface of the earth?

The only direct way of confirming oil’s presence is to drill a well.

But, drilling a well is an expensive proposition. Most wells cost in excess of $100,000 to drill, and many cost over $1,000,000. These costs typically cover the drilling rig alone, and don't consider the costs of necessary supporting equipment and supplies. For example, costs for

PDC (polycrystalline diamond compact) drill bits , used to cut into the earth, alone can be in the thousands of dollars.

Given that the success of finding commercially producible-sized hydrocarbon reservoirs is approximately 1 in 10 chances, oil companies - out of sheer necessity - seek to minimize the cost of failed wildcats by exhausting all reasonable indirect methods of locating hydrocarbons first.

Seismic surveys, using a variety of sonic wave producing guns and extra-sensitive listening devices, allow geophysicists to obtain profiles (cross-sections) of subsurface rock at great depths. If a trap of some sort can be deduced from the sub-surface reflections, there is a chance that oil or gas can be found.

Gravitational and magnetic surveys are flown by aircraft over areas on land and sea to identify the geophysical properties which might suggest the presence of hydrocarbon bearing traps.

Ultimately, though, it is only by drilling the well that the indirect observations will be confirmed.


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