OIL & GAS BULLETIN. 1 st EDITION 2016/2017 YASMIN, INTAN & AIN EDITED BY
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1 OIL & GAS BULLETIN 1 st EDITION 2016/2017 EDITED BY YASMIN, INTAN & AIN
2 Oil and gas. An industry so immense that it has made a name, not just in this country, but also in other world leading countries. Many are unaware that this industry has contributed enough economic power for our country to be able to stand where it is today. This industry existed many years ago, since pre-historical times, but gained its recognition especially when it is discovered that oil is able to create energy. Ancient civilizations first used oil for medicinal purposes and water proofing. In North America, native Americans used oil as body paint and to ignite fires for their ceremonies. Around 600 BC, oil was extracted for domestic use, as it was found to provide many medical benefits and as fuel in Azerbaijan. Azerbaijan, which means the land of fire is believed to be the first ever oil producing country in the world. Some time later, people got more creative and started to use whale oil. The whale oil originates from the nose of the sperm whale and it is used as candles and lamps as it burned with less soot. In short, it is redundant to say that the existence of oil itself has eased almost every mankind s lives, even until today. From cosmetic products, lubricants and providing fuel for our moving vehicles, we become dependent consumers of it. One who chooses to be affiliated with this line of career will reap many benefits including travelling, enjoying a rewarding amount of pay and the fascination from discovering things you do not get to witness everyday, be it upstream or downstream. However, the recent downturn for this industry has left quite an impact. The price of crude oil was hitting a low amount of $26.21 a barrel, making this the biggest drop in crude oil price since the 1990s. In Malaysia itself, many oil rig productions were put to stop and any person associated with the rig were laid off from work. Besides that, many Oil and Gas companies were not hiring, some even disapproves on the idea of hiring interns to cut down on spending. The reason for such thing to happen is due to, essentially, oil being produced more than it is being demanded. OPEC, (The Organization of Petroleum Exporting Countries), the largest producers consisting of mainly Arab countries, was not determined to cut down production as a way to prop up the crude oil prices. The United States, who are extracting shale oil from rocks and hills will not be able to survive long if OPEC continues to do so. While OPEC manipulates the market and eliminates its competitors, they put high hopes that the slump will eventually shut down high-cost production, tightening the market again. Meanwhile in Malaysia, Oil and Gas companies suffer as the revenue was cut by half, or more than half the usual price. (From $100 per barrel to less than $50 per barrel). The Oil and Gas companies in Malaysia had invested heavily in infrastructure such as oil rigs, manpower and expertise, exploration, equipment and so on. If they were to continue drilling, the revenue will continue to decrease. As disheartening as this sounds, it is believed to be a series of fluctuations that can happen to any other industries too. Fortunately, just last month, the oil price rose up to $50 per barrel. A few months back, British Economist Spencer Dale, who currently holds the position of the chief economist of BP (formerly known as British Petroleum), predicts that the industry will eventually improve, although he did not give an exact number on how much the crude oil price will be in the future. He also urges everyone who is in the industry to adapt through times of difficulties and anticipate on what will happen next. Let s just say his predictions came true, at least so far. To those who thought of switching careers, hold that thought and grasp onto your dreams to be a part of the Oil and Gas company. If you are afraid of being poor because of a downturn of an industry of your dream job, keep this in mind, a person who has passion in doing what he does, will never be poor.
3 How Oil & Natural Gases Forms Stage 1 - All of the oil and gas we use today began as microscopic plants and animals living in the ocean millions of years ago. As these microscopic plants and animals lived, they absorbed energy from the sun, which was stored as carbon molecules in their bodies. When they died, they sank to the bottom of the sea. It mixes with inorganic matter, such as clay particles and very fine sand, and with dead marine plankton (microscopic organisms). This mixture is transformed into dark, foul-smelling mud by anaerobic bacteria. Over time, this mud accumulates and hardens. Mud that contains at least 1 to 2% organic matter may be transformed into source rock. The weight of accumulating sediment very slowly pushes the source rock further under the Earth's crust, by a few meters to a few hundred meters every million years or so. This gradual sinking is called subsidence and leads to the formation of sedimentary basins. Stage 2 -As it sinks below ground, the source rock is subjected to increasingly high temperatures, the organic matter that makes up the rock is crushed by the weight of the accumulating sediments, and the pressure increases by 25 bar every 100 meters on average. Under these physical conditions, the nitrogen, sulfur and phosphorus atoms are gradually converted into kerogen, an intermediate material made up of water, carbon dioxide, carbon and hydrogen, which is then transformed into oil or gas. As they became buried ever deeper, heat and pressure began to rise. The amount of pressure and the degree of heat, along with the type of biomass, determined if the material became oil or natural gas. If the organic debris is composed mostly of animal origin, it will produce more oil than gas. If it is composed mainly of plant debris, the source rock will produce mostly gas. At about 60 degrees Celsius, oil begins to form in the source rock due to the thermogenic breakdown (cracking) of organic matter (kerogen).the oil window is a temperature dependant interval in the subsurface where oil is generated and expelled from the source rocks. The oil window is often found in the degree Celsius interval (aprox. 2-4 km depth), while the corresponding gas window is found in the degree Celsius interval (3-6 km depth).
4 Stage 3 - After oil and natural gas were formed, they tended to migrate through tiny pores in the surrounding rock. Some oil and natural gas migrated all the way to the surface and escaped. Other oil and natural gas deposits migrated until they were caught under impermeable layers of rock or clay where they were trapped. These trapped deposits are where we find oil and natural gas today.
5 The Role of Geologists In the Oil & Gas Industry In this wide vast era of exploding industries, the oil and gas industry has become one of the most observed and important field that attracts the attention of many. More academic institutions are introducing courses and programmes related to this industry to gain more interest of the youths towards this industry as it is holds a very big role in maintaining the world s economy. One of the most vital roles in the oil and gas industry are played by the petroleum geologists. Like in the other fields, the geologists are mostly involved in the exploration phase, where they look for the oil resources or to be more specific, the oil deposits. This is why a petroleum geologist needs to have a strong knowledge of the geological principles. Their skills of exploring various types of land and sea regions and accessing the resources in the explored land aid them in pin-pointing the potential oil resources. In the early exploration phases or what we can call as oil-hunting, there are a few ways that the geologists use as a path-finder to look for the potential resources. To look for the early signs of oil in an area, the geologists would take the rock samples to be analyzed in the laboratory. A small scale drilling will also be carried out to collect subsurface sediments, also to be further analyzed in the laboratory. Afterwards, a detailed analysis is done on the samples taken from the site. The petrology of the rock samples are observed and studied using the microscope to make sure of the type of rock that exist on the site and whether they are the rock types associated with the formation of oil deposits. A geochemical analysis kit is also a must-have in the lab, together with other proper lab equipment that are suited to look for the hydrocarbons and minerals consistent with the oil-rich areas. Aside from laboratory-handling skills, it is also expected of the petroleum geologists to have competent mapping abilities, making full use of the Global Positioning System (GPS) and Geography Information System (GIS) as well as 3-D graphing software. Systematic data produced from the software together with near-accurate interpretation by the geologists help them in determine the exact location of the oil deposits that are likely to yield profitable production. The mapping abilities would also give them an in-sight of the suitable depth to drill and what methods are most suitable, safe and appropriate to drill. In certain situations, the petroleum geologists should also have some knowledge in the maintenance of the reservoirs and some other devices, so that they can cooperate well with the petroleum engineers, drilling engineers and other technicians on the oil rig platform. The technical part are not the only thing that is important in an oil and gas industry. As geologists who are mostly associated with the Earth and the natural surroundings, they must also take the matter of the environment safety into hand. With their knowledge of the Earth structures and environment, they should consider the preservation and conservation of the environment and surrounding potential drilling site. They are also responsible in promoting careful drilling practices to minimize pollution and disturbances to the Earth. Bearing the title of a petroleum geologist comes with a huge array of responsibilities. Besides being equipped with strong geological knowledge and advanced mapping and laboratory-handling skills, petroleum geologists must also be a quick-adaptor and a risk-taker. The petroleum geologists have to always bear in mind that their every step should be taken with serious thought and thorough consideration to avoid loss and waste of the huge amount of money invested for each oil and gas exploration, from looking for the resources, to the drilling of the potential deposit, to the extraction of the resources. They must always be prepared to be transported to deserted and unexplored lands to conduct new expeditions with one ultimate goal - that is oil and natural gases.
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