Oil Notes

Oil

  • Petroleum is a thick liquid composed of combustible hydrocarbons with sulfur, oxygen, and nitrogen impurities.

  • Formed from decomposed organic matter under heat/pressure over millions of years.

  • Natural gas is often trapped with oil.

Oil Recovery & Types

  • Only about 35% of oil in a deposit can be recovered.

  • Light crude oil:

    • Lower viscosity, easier to pump.

    • Used for gasoline, diesel, and aviation fuels.

  • Heavy crude oil:

    • Higher viscosity.

    • Used for transportation fuels, plastics, petrochemicals, other fuels, and road surfacing.

Environmental Impact & New Techniques

  • Oil drilling: moderate land damage due to small well area.

  • Drawback: oil spills during pumping/transport.

  • New drilling techniques:

    • Deeper drilling on land/ocean.

    • Fewer rigs using one rig to drill multiple pockets.

    • Lateral drilling up to 8 km.

Economic Factors

  • Heavy crude is profitable at oil prices of 30-$40 a barrel.

    • At this price, world oil reserves could increase by ~50%.

    • Alternative fuels become competitive.

Refining Oil

  • Oil requires refining (heating and distilling) after extraction.

  • Distillation products (petrochemicals) are used in pesticides, plastics, synthetic fibers, paints, medicines, etc.

Oil Reserves & OPEC

  • Oil reserves: deposits that can be extracted profitably.

  • OPEC controls 67% of world crude oil reserves.

  • Largest reserves: Saudi Arabia (26%), Iraq, Iran, Kuwait, UAE (9-10% each).

Oil Supply Longevity

  • Oil, natural gas, and coal are non-renewable and will decline.

  • Affordable oil will decrease as demand exceeds production

  • Global oil reserves at current consumption rates = ~53 years.

  • Undiscovered oil could extend this by 20-40 years (at higher prices).

Heavy Oils & Shale

  • Light oil is most useful; heavy oil needs more refining.

  • Oil shale contains kerogen.

  • Kerogen distilled from oil shale yields shale oil.

  • Shale oil requires heating and removal of impurities.

  • Shale oil supplies are ~240 times more than conventional oil but are low grade.

  • Profitable to mine at prices over $60 a barrel.

Tar Sand

  • Tar sand: clay, sand, water, and bitumen (heavy oil with high sulfur).

  • Bitumen is extracted, purified, and upgraded to synthetic crude.

  • Largest deposits are in Northern Alberta, Canada.