Britain’s Onshore Oil Industry PDF
Preview Britain’s Onshore Oil Industry
BRITAIN'S ONSHORE OIL INDUSTRY GLOBE INDUSTRY REPORTS is a management reports' series specially written by expert observers and experienced practitioners for senior managers in industry, commerce and the professions. The reports are designed to offer the manager the benefits of in-depth business information on a wide range of industries. They highlight the opportunities for profit- and risks- of industries in today's economic climate. Already published 1 John Huxley: BRITAIN'S ONSHORE OIL INDUSTRY 2 Hidde P. Smit: FORECASTS FOR THE WORLD RUBBER ECONOMY TO THE YEAR 2000 3 James J. Lynch: AIRLINE ORGANIZATION IN THE 1980s BRITAIN'S ONSHORE OIL INDUSTRY John Huxley Palgrave Macmillan @J.D. Huxley 1983 All rights reservedo No part of this publication may be reproduced or transmitted, in any form or by any means, without permission First edition 1983 Reprinted 1986 Published by MACMILLAN PUBLISHERS LTD (Journals Division) Additional material to this book can be downloaded from http:/f extras.springer.com ISBN 978-0-333-34526-9 ISBN 978-1-349-06597-4 (eBook) DOI 10.1007/978-1-349-06597-4 Set in IBM Courier by Morgan-Westley, Bristol To my mother who always said I would do it, and my wife and son who ensured that I did. Contents List of figures ix List of tables X Preface xi Acknowledgements xiii Units of Measurement xiv Glossary XV List of appendixes xvii 1. The Hidden Industry 1 2. The Lie of the Land 9 3. Environmental Impact 20 4. Beginnings 28 5. Shale Oil 34 6. The First Drilling Campaign 40 7. Nationalisation 46 8. The East Midlands Oilfields 51 9. Natural Gas 62 10. Crisis and Recovery 69 11. Wytch Farm 77 12. Into the 1980s 87 13. The Prospective Areas 94 14. The Participants 102 15. Onshore Economics 111 16. The Licensing System 118 17. Land Access 126 18. Planning Problems 134 Postscript 141 Appendixes 145 Notes 175 Index 186 vii List of Figures 1.1 Onshore oil and gas fields 2 1.2 Onshore drilling, 1972-81 3 1.3 Onshore drilling: rig activity 4 2.1 The geological time-frame 10 2.2 Petroleum geology 11 2.3 Formation of an oil trap 13 2.4 Seismic survey - Vibroseis method 15 2.5 Rotary drilling rig 16 2.6 Typical exploration well 18 2.7 The search for oil and gas prospects 19 3.1 Impact assessment matrix 21 3.2 Typical exploration drillsite layout 24 5.1 Oil shale fields of the Lothians 35 5.2 Production of crude oil from Scottish shale, 1873-1962 37 5.3 United Kingdom oil shales 38 8.1 East Midlands oilfields 54 8.2 Section through the Eakring oilfield 55 11.1 Drilling in Dorset 79 11.2 Wytch Farm: principal sites 81 11.3 Wytch Farm: cross-section of track of development well 83 11.4 Wytch Farm: schematic diagram of oil field 85 13.1 North-west Europe, discoveries and main prospective basins 95 14.1 Enhanced oil recovery using carbon dioxide 107 ix List of Tables 6.1 Hardstoft - war-time production 43 6.2 1918-22 drilling campaign 44 so 7.1 Formby - production 8.1 East Midlands - production 57 8.2 Wareham, Kimmeridge - production 61 9.1 Gas (methane) production in the United Kingdom 62 10.1 Oil price adjustments since 1970 76 11.1 Wytch Farm - production 77 12.1 Licensing and drilling activity 88 14.1 Licence holdings, Mar. 1981 - Mar. 1982 lOS 15.1 Wytch Farm cash flow 117 X Preface It still comes as something of a shock to many people to learn that Britain produces oil from onshore wells. Until fairly recently the industry had received little attention, and although it is now more than 60 years since the first oil was pumped from this green and pleasant land, no previous book has been published on the subject as far as I am aware. By contrast, while production from the British sector of the North Sea is not yet 20 years old a big library on the subject has already been written and is being added to regularly. This is not altogether surprising given the disparity in output on and off shore, and the contribution made by the latter to the country's financial well-being. Nevertheless, it is clearly time to remedy the omission so far as the landward activity is concerned. Not only does Britain, indeed, have a busy onshore oil industry, but it is one that can now boast a field with reserves bigger that those of several commercial North Sea finds. OVer the past few years, exploration has attracted increased attention, and not merely from those whose task it is to organise, finance and undertake the search for oil and gas. It has also come more to the notice of planners, politicians and members of the general public who must debate and decide how far exploration and production are compat ible with other objectives, such as conservation of the countryside. To them, the petroleum lying beneath Britain's countryside - and towns - must be seen as a mixed blessing, involving cost as well as benefit. For this reason, the industry, as it has grown during the 1970s, has become part of the broader and bigger conflict between energy and the environment, expressed elsewhere in debates over, for example, new coal mines (as at Vale of Belvoir in Leicestershire) and the siting of new power stations (as with the pressurised water reactor proposed for Sizewell in Suffolk). It is humbly hoped that this book, apart from being an interesting and reliable guide to the past, present and future of a fascinating industry, will also provide some of the background information needed by all parties if there is to be better mutual understanding of the prob lems involved and a sensible resolution of them. Although I have received tremendous guidance and encouragement from many people both inside and outside the industry, any one of whom might have been better qualified to write this book, I am well aware that the result may suffer some of the defects stemming from its being, effec tively, the first in the field. Historical source material is limited, much contemporary information is confidential, and though many within the industry freely contributed their opinions, understandably few wished to lend their names to published comments. Still, this book is a start. Perhaps others will now be provoked to rectify any short comings, fill out some of the detail, and take the story further. Finally, I am painfully aware that the conclusions, largely incorp orated in the postscript, may seem overly tentative. If this is so it is for two important reasons. Firstly, the book is being written at a time of much unfinished business within the industry. Large finds are still awaiting exploitation. The long-term impact of a recent planning decision has still to be seen. Secondly, recent history strongly urges caution in energy forecasting. An important determinant of the future xi
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