Unconventional but Not Impossible: Technological advances increase access to oil.

• Author: Shipe, O'Hara
• Position: OIL & GAS

Anthony F. Lucas ushered in the "oil age" in 1901 in Beaumont, Texas, drilling a well that blew oil 150 feet into the air at a rate of 100,000 barrels of oil per day. After one hundred years of operations, the US oil and gas industry found itself uncomfortably situated between increasingly obsolete drilling methods and the fear that oil production might soon reach its natural limit.

"If you look back probably to 2005--where we were as an industry within North America--it was a pretty dismal outlook. Total oil production was declining rapidly, and we were thinking we were going to be so reliant on importing hydrocarbons, both gas and liquids, from other countries to sustain our energy needs," explains ConocoPhillips' Director of Unconventional Reservoirs Excellence Nathan McMahan.

Instead of simply moving out or moving on, the US oil industry rose to the challenge of developing more affordable and efficient ways of extracting oil. And the industry succeeded, both in the United States and worldwide. Additional availability of oil, combined with a decline in worldwide demand, contributed to oil prices crashing from $100 per a barrel to $50 in 2015. Again the industry adjusted by finding or creating efficiencies and improved technology in the new low-price environment. Innovation takes substantial technological investments that are not guaranteed to work, and as such for some organizations the focus continues to be on operating costs rather than enhancement.

According to McMahan, the outlook for the industry has completely changed from a limited resource in the early 2000s to a "big abundance resource" in the last few years. McMahan believes that this change can largely be attributed to a paradigm shift in thinking. "Somebody believed there might be enough hydrocarbons down there to still be extracted and they asked the question, 'Why haven't we tried combining existing technologies?'"

Advancing Drilling Techniques

An early technology aimed at accessing unconventional oil resources was hydraulic fracturing, developed around the 1950s. In the 1980s, horizontal drilling began to see large-scale use. More commonly referred to as tracking, hydraulic fracturing is a well stimulation technique in which rock is fractured by a pressurized liquid to create cracks in the deep-rock formations through which natural gas, petroleum, and brine flow more freely.

Another technology, horizontal drilling, is a process of drilling a well from the surface to a...