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Papua New Guinea (PNG) lies in a complex and active part of
the Pacific on the transpressional and convergent margin of the
Australian and Pacific Plates, which experiences significant
left lateral displacement. Until the Cretaceous, the area was
a passive continental margin on the northern Australian Plate.
As the Australian Plate converged with the Pacific, it collided
with the western Pacific island arc systems, similar to the phenomenon
in the Tonga-Kermadec and Marianas systems. The arcs accreted
in part to the northern and eastern margins of the mainland of
New Guinea and continued to extend offshore. To the north and
east, the tectonic picture identifies the New Ireland and Bismarck
Arcs and the Trobriand Trench that separate the Bismarck Sea,
Solomon Sea and Woodlark interarc basin microplates. |
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The search for remaining large reserves of hydrocarbons in relatively
underexplored regions, such as the North Aleutian Basin remains
a challenge. Consequently, the energy industry is increasingly
focusing on areas of lower uncertainty - in basins with proven
petroleum systems and proven technology. The average size of
discoveries is decreasing. Some argue that this is evidence of
peak oil. True or not, it is certainly related to a significant
change in oil company management processes and a shift away from "exploration
thinking" over the past 20 years. |
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This month "The Next El Dorado" takes a look at what
might be the unexplored equivalent of the largest producing onshore
basin in Australia, the Cooper Basin. Australia's attractive
fiscal terms and stable political and economic systems, along
with the increasing oil and gas prices and resolution of native
title issues, make the area ripe for new exploration activity
after more than 20 years of inactivity. Large acreage tracts
across the Amadeus, Pedirka/Eromanga and Beetaloo basins have
been taken up by the new explorers Central Petroleum, Rawson
Resources and Sweet Pea. |
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In 2006, Hardman Resources and its partner, Tullow, drilled
three remarkable oil discovery wells in the Albertein graben
in northwestern Uganda. Only three other wells had been drilled
in the area till now: one by Shell in 1938 and two recently by
Heritage to the south. These discoveries once again point out
that with ideas, imagination and persistence, major oil discoveries
can still be made. |
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The multiple and extensive basins of the Arctic are considered
the last frontier for oil and gas exploration, given that the
Antarctic is likely to remain forever quarantined from exploration.
The challenges are great, both geologically and operationally.
The area has traditionally been left to the major and national
oil companies with large pockets and long-term objectives. Alaska,
the North Slope and Western Siberia have been the focus of most
of the exploration to date. Oil and gas infrastructure, terminals,
pipelines and support facilities have been put in place, and
these opportunities have attracted the independents and smaller
operators. However, increasing attention is now being given to
new areas of the Barents Sea. |
The
Next El Dorado - November 2006 - World
Energy Monthly Review
Improved infrastructure and industry reform have made Australia
a destination to consider.
The International Conference and Exhibition of the AAPG (American
Association of Petroleum Geologists), sponsored by the Petroleum
Exploration Society of Australia, is being held in Perth, Western
Australia, November 5-9, and provides internationally oriented
companies and "The Next El Dorado" an opportunity to
look at Australia as a valuable exploration area. Australia is
a resource-rich country that offers very attractive energy investment
opportunities. Its petroleum industry is active and varied, with
multiple basins both onshore and offshore, and it may offer a
sensible alternative to North American companies looking for
growth in a politically stable area, whether by acquisition or
by the drill bit. A number of structural changes to Australia’s
petroleum industry from the mid-1990s to the early 2000s have
resulted in an ever-growing number of investment opportunities
in the upstream and midstream sectors of the petroleum industry
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Politics aside, the Niger Delta is one of the world's richest
petroleum provinces.
Exploration success in the Niger Delta and Gulf of Guinea continues
to attract new companies who believe that, with new technology,
even larger reserves can yet be found there. Exploration began
in the area in 1908, with drilling near onshore oil seeps, but
modern exploration really began in the 1960s. Even though the
region has been active for decades, exploration efforts continue
to expand despite many business and operational obstacles.
The Niger Delta is the largest Tertiary delta complex along the
western African margin, where the petroleum system is dominated
by the high Neogene sedimentation rates that occurred following
the rifting and opening of the Atlantic Ocean. |
The
Next El Dorado - September 2006 - World
Energy Monthly Review
Majors have long ignored the Republic of Seychelles. Perhaps
it's time they took another look.
The Republic of Seychelles is an archipelago of granitic and
coral islands in the western Indian Ocean, northwest of Madagascar.
This is a frontier exploration region that is underexplored despite
having indications that oil and gas are present. The region is
a large plateau some 200 kilometers long, a micro-continental
fragment that detached from Madagascar and India some 200 million
years ago. The rifting associated with the breakup of Gondwanaland
was the key to the formation of a potential petroleum system.
The Seychelles was originally juxtaposed with the Bombay High,
a prolific producing petroleum province of India, which itself
extends into the Cambay rift basin northward into Rajasthan,
India. The Cambay Basin itself is a relatively newly discovered
petroleum system where Cairn is currently leading exploration
efforts. South of the Seychelles in Madagascar, billions of barrels
of heavy oil are trapped in exhumed oil sands currently being
licensed by Exxon. |
The
Next El Dorado - August 2006 - World Energy
Monthly Review
Southeastern Australia is a hot market for natural gas. There's
a resource play nearby that, if handled right, can fill the need.
Large resource plays in Australia have not had a chance to mature,
mainly due to lack of infrastructure, higher-cost drilling and
completion services and relatively low gas prices. This may be
about to change. Although natural gas prices are relatively low
in Australia, they are measurable and stable. If total finding
and development costs can be kept low, the economics should be
attractive to investors.
Recent developments in coal seam methane, or CSM, in northern
New South Wales and Southern Queensland – in particular,
the aggressive position taken by Orion – indicate an increasing
interest.
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The
Next El Dorado - July 2006 - World Energy
Monthly Review
Malaysia’s long production history moves into the future
with new discoveries and LNG potential.
The current Federation of Malaysia was formed after World War
II following independence from Great Britain. Malaysia is a country
with a long production history going back to the early part of
the 20th century, when the predecessors of Shell undertook onshore
exploration and production in the provinces of Sabah and Sarawak
in eastern Malaysia. Between these states is the Sultanate of
Brunei, a rich producing nation, and it has remained an independent
nation.
Early exploration focused on the edges of the Baram Delta, the
distributaries of which drain the western mountains of Kalimantan.
The delta, like many of the major Tertiary delta systems around
the world, had prolific production established onshore and in
the shallow offshore environments.
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The
Next El Dorado - June 2006 - World Energy
Monthly Review
A thriving economy and established reservoirs are among the
qualities that bring consideration to Israel.
Israel is part of a tectonic province at the eastern end of
the Mediterranean Sea referred to as the Levant, which was formed
by the rifting of the Tethys Sea, convergence of the Eurasian
plate and eventual rifting of the African continent. Besides
Israel, the Levant includes the countries of Lebanon, Syria and
Jordan. The area is today focused along the Dead Sea and Jordan
Rift Valley, which is about 360 kilometers long, trending roughly
north-south, and is the depression in which the Jordan River
and Dead Sea reside. In addition, the regional Syrian Arc fold
belt created a series of northeast-southwest structures of which
the Judean and Samarian Mountains are a part. This region has
been dominated by carbonate, evaporate and clastic deposition
since the pre-Cambrian, with major structural development and
volcanism in the Mesozoic and Neogene.
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The
Next El Dorado - May 2006 - World Energy
Monthly Review
To overcome decades of poor data, the Ferghana Basin in Central
Asia can benefit from today's seismic modeling and reap potentially
large new discoveries.
The Ferghana Basin in Central Asia is an elongate, intermontane
productive basin, stretching east-northeast to west-southwest,
that extends along eastern Uzbekistan into Kyrgyzstan and Tajikistan,
and it covers an area of approximately 15,500 square miles. The
greater part of the basin lies in the eastern part of Uzbekistan
and a portion of Kyrgyzstan. The petroleum production in this
basin stretches back to the start of the last century, and since
then a large number of shallow fields have been developed. Prior
to dissolution of the Soviet Union, oil and gas exploration of
the Ferghana Basin of Uzbekistan, Tadjikistan and Kyrgyzstan
discovered more than 50 fields, most of which lie in the margins
of the basin. Ulmishek and Masters estimated in 1993 that the
total undiscovered oil resources of the Ferghana basin were about
3,000 million barrels, and the total undiscovered natural gas
resources of the basin about 3 trillion cubic feet. The current
fields are in significant decline, but facilities and pipeline
infrastructure are available to allow production to be bought
on stream in a relatively short period.
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The
Next El Dorado - April 2006 - World Energy
Monthly Review
Still calling the Gulf of Mexico the "Dead Sea"?
Resurrection is afoot, to the tune of 300 billion boe in our
own backyard.
Our quest for energy sources this month takes us to the Gulf
of Mexico (GOM), the huge remaining potential at the U.S. back
door.
The recent announcement of a successful deepwater oil discovery
in the Gulf of Mexico, Noxal 1, by Petróleos Mexicanos
(PEMEX) highlights the ongoing value of the GOM to the energy
industry and to the United States. The recent discovery could
be followed up by similar finds, especially if Mexico begins
to allow alliances with companies experienced in deepwater exploration. |
The
Next El Dorado - March 2006 - World Energy
Monthly Review
In California, the San Joaquin Basin holds oil and gas potential
in the millions and trillions of barrels.
The San Joaquin Basin has been a prolific oil and gas province
for a century. The U.S. Geological Survey (USGS) recently estimated
that a mean of 1.7 trillion cubic feet (tcf) of undiscovered
natural gas and a mean of 500 million barrels of oil and gas
liquids remain as an undiscovered resource in the San Joaquin
Basin, which lies between Modesto and Bakersfield, California.
This does not include the currently discovered and unproduced
oil and gas. A number of explorers in the basin believe this
to be a very conservative estimate of the remaining undiscovered
potential in the basin as it represents less than 4 percent of
the already discovered reserves. There have been more than 15
billion barrels equivalent produced from the San Joaquin Basin.
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The
Next El Dorado - February 2006 - World
Energy Monthly Review
The Gulf of Mexico shelf is a geologic wonder. So is it any
wonder there are vast discoveries to be made there?
The Gulf of Mexico shelf – a coastal area in a water depth
of 0 to 600 feet – has been getting a lot of industry attention
with numerous presentations, articles and studies outlining the
potential of this play. Of course, opinions vary as to the viability,
economics and size, but El Paso was one of the early entrants
into a significant new basin with excellent hydrocarbon potential.
Many question the view of this play as a new basin, instead considering
it merely an extension of the conventional Gulf of Mexico play.
Following are reasons for approaching it as a new basin.
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The
Next El Dorado - January 2006 - World
Energy Monthly Review
(Very) deep in the heart of Texas, the Barnett Shale is finally
getting its recognition.
The Fort Worth Basin has been known as a petroleum province
for almost a century. However, it is only recently that the Barnett
Shale field has been recognized as one of the largest gas plays
in the United States. In fact, the U.S. Geological Survey did
not recognize it as a significant petroleum system even as late
as 1995.
Mitchell Energy pioneered the play while drilling for shallower
targets in the Fort Worth Basin in the 1980s. However, the major
growth in the play has come in the last five years or so. |
The
Next El Dorado - December 2005 - World
Energy Monthly Review
Utah's Northern Paradox Basin gets Neville Henry's attention:
big, accessible and ready to play.
After searching the world for more than 30 years and having
had a taste of discoveries in a number of basins worldwide, at
first it seems surprising to be introduced to such an attractive
play here in the United States that has had little exploration.
The basin has produced more than 1 billion barrels equivalent,
and it has multiple reservoirs, proven source rocks, moderate
operating conditions and access to production pipelines. So what
are we doing with a $60 oil price and predictions of $20 gas
this winter?
The hardest question to answer is, "why this has not been
played in a serious fashion?" Finding oil or gas is really
a combination of technical analysis, imagination and ideas, but
it is more about having the courage to be the first to test those
ideas. |
The
Next El Dorado - November 2005 - World
Energy Monthly Review
Libya? For serious players only, please.
Competitive bid rounds, particularly when the fiscal terms are
tough, are not where you usually find a hidden treasure. However,
with Oilfield Development Specialists (ODS) I was fortunate to
have assisted a recent evaluation of three basins onshore Libya
that might well hold a prize. This group completed a fine effort
of integrating the geological, engineering and risk components
in under 45 days. Despite having seen success exploring in Algeria,
Tunisia and Egypt, I was skeptical about whether the rewards
would likely justify the entry efforts, costs, exploration risks
and financial risks, even if the geological factors were positive. |
The
Next El Dorado - October 2005 - World
Energy Monthly Review
California's untapped offshore wealth.
Would you believe it? A world-class basin has leases covering
known oil accumulations expiring unproductive, undrilled, untouched
and unloved. Alas, they lie in the most challenging oilfield
environment on Earth, an exotic land of unfathomable customs,
intermittent electric power and inscrutable rulers: California.
The George W. Bush administration, able to run roughshod over
much of NATO and the United Nations and project U.S. military
might 10 time zones away for securing oil resources, has been
stymied from exerting sovereignty over the federal outer continental
shelf (OCS) waters offshore California. |
The
Next El Dorado - September 2005 - World
Energy Monthly Review
Did somebody just say New York? We rate the Black River Basin.
Yes, one is reminded of the well-known salsa TV commercial.
In fact, many E&P companies seem to have a similar reaction
to New York State prospect-bearing geologists: "Get a rope." Nonetheless,
the Trenton/Black River play has gas prospectors looking closely
at the Empire State. After all, New York’s gas production
last year was up by 30 percent over 2003, with most of the increase
coming from the Trenton/Black River.
A major-league natural gas prospect just happens to be within
a compressor station’s throw of the most gas-hungry market
in the United States: New York City. |
The
Next El Dorado - August 2005 - World Energy
Monthly Review
We look at the Beetaloo Basin and apply our rating system to
this Aussie prospect.
The Australian Outback has challenged explorers for decades.
But the Outback may also contain significant oil and gas deposits
in an area known as the Beetaloo Basin.
Located 500 kilometers south of Darwin, the Beetaloo is a broad
intracratonic basin with mesoproterozoic and younger sediments.
It is, in part, superimposed on the McArthur Basin, an older
sediment-filled rift basin to the east. |
The
Next El Dorado - July 2005 - World Energy
Monthly Review
We discuss KMP's methods to produce stranded oil and apply
our prospect rating system to CO2 injection.
Everyone in the Oil Patch knows the term "stranded gas." But
the future of America’s energy business is in "stranded
oil." And one of the best ways to get that oil out of the
ground is with carbon dioxide (CO2) injection.
Two Houston companies, Kinder Morgan and Anadarko Petroleum,
are using CO2 to stimulate production in their fields, and their
success is attracting attention. For good reason: In some cases,
CO2 injection is increasing production by as much as 600 percent. |
The
Next El Dorado - June 2005 - World Energy
Monthly Review
We discuss Alaska's history and apply our prospect rating system
to the Cook Inlet, America's Siberia.
The Cook Inlet is the Rodney Dangerfield of U.S. oil-producing
provinces. What else would you call a region that has produced
more than 6 Tcf of gas over the past 40 years, yet hasn’t
seen a drilling rig for 14 years?
If rationality ruled, Alaska’s Cook Inlet would be one
of the hottest areas in North America. Instead, the area has
been eclipsed by the North Slope and by the Arctic National Wildlife
Refuge. But just because other players are overlooking the Cook
Inlet, it doesn’t mean you must do the same. |
The
Next El Dorado - May 2005 - World Energy
Monthly Review
We discuss heavy crude production methods and apply our rating
system to the Canadian oil sands.
By now, most people in the Oil Patch are familiar with Canada’s
heavy oil deposits. That said, few people realize just how game-changing
these deposits are. Here are the facts:
• In 2001, Canadian heavy oil production exceeded conventional light oil
production.
• In 2003, Canadian heavy oil production exceeded 1 million barrels per
day.
• By 2015, Canadian heavy oil production is expected to exceed 3 million
barrels per day.
Commercial oil sands production in Canada began in 1967. But
technical, economic, political and environmental challenges to
scraping up dirty sand, cooking the tar (actually bitumen) out
of it and upgrading the bitumen into a usable product seemed
likely to condemn it to a marginal existence. |
The
Next El Dorado - April 2005 - World Energy
Monthly Review
We discuss what prospectors really mean by success and apply
our prospect rating system to the Barnett Shale.
A few weeks back, I attended my all-time favorite celebration
of the American hustle, the North American Prospect Exposition,
more popularly known as NAPE.
Geophysical and geological types were in abundance. I stopped
to talk to a member of one group that seemed to have a particularly
powerful interpretation technique. I asked the question that
oilmen have been asking since Spindletop: "Uh, what’s
your success ratio?" While this may seem a simple question,
I’ve never received a simple answer. |
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