“The economy runs on oil,” said Paul Nadeau, Ph.D. and industry geologist, “and oil may be running out” (1) Understanding oil’s importance, efficiency, predictions about peak oil production and the inherent risks in finding oil is necessary to secure sufficient energy resources needed to meet growing world demands.

Head Honcho
Fossil fuels make up 85 percent of the world’s energy budget, and oil remains the world’s largest source of energy. Each day 85 million barrels of oil per day are burned to meet 40 percent of the energy demand (2). The second and third largest sources of energy are natural gas (24 percent) and coal (23 percent) (2).

The Middle East alone holds the majority of known oil reserves. By 1980, after decades of foreign production beginning in 1933, Saudi Arabia wrested control of its oil industry, dwarfing the production of American oil moguls like Exxon-Mobil and Shell (3). Today foreign oil companies like Exxon-Mobil receive a finder’s fee to produce oil in host countries such as Saudi Arabia. The move resulted in the prior American oil giants providing services to oil-rich nations.

Oil production has already peaked in most non-OPEC countries.

Oil production has already peaked in most non-OPEC countries.


It takes money to make money, and energy to produce energy. Easily transported and efficient, oil remains the world’s most prized natural resource, although its efficiency depends on its type. Crude oil produces 10 times the energy it takes to extract it, less valuable heavy oil has a 5:1 energy return, and non-conventional hydrocarbons such as heavy oil sands and oil shale yield a 2:1 and 1:1 energy return, respectively (1).

Biofuels, a possible oil alternative, boast an 8:1 return, three times greater than the ratio of non-conventional hydrocarbons (4). Geologists in the business, however, maintain that if biofuels are to compete on the same scale as oil, the majority of America’s arable land must be devoted to biofuel crops, not food crops (3). Other viable alternative energies like geothermal and wind, produce electricity are not as portable as fossil fuels, making them less viable options.

Draining the Last Drop
As Marion King Hubbert pointed out as early as the 1950s, the question is not when will we run out of oil, but when the global demand for oil exceed supply. He noted that demand would increase exponentially, initially fitting the production curve for oil but soon far exceeding it. The trends have followed his predictions: since the 1970s production rates have dwarfed discovery rates. Hubbert predicted that oil production would peak in 2020 (5). Thereafter, accommodating growing demand would require tapping other energy sources.

Estimates of peak production range, however, from Hubbert’s lower bound of 10 years from now to an optimistic 100 years in the future (assuming unconventional hydrocarbon reserves will be discovered in Canada and Latin America) (5). David Deming Ph.D., an industry geologist, cites the difference between resources and reserves, the known and extractable oil resources using current technology, as the reason behind these vastly different estimates. He asserts that the focus on current known reserves is shortsighted.  He argues that reserves increase due to innovations in technology; given current technology, only 20 percent of oil found in the ground is extracted (pumping CO2 or water into the reservoir rocks can displace the oil found in its pores and recover as much as 75 percent of oil) (6). A 1 percent increase in recovery rates would augment known reserves by 1,500 million barrels of oil.

Risky Business
Many discovered oil fields are abandoned because they are too small to be economically viable or too expensive to drill because the oil is too deep. Reservoir rock porosity, a measure of the amount of holes in a rock storing oil (oil is contained in the holes, not in the rock itself) plays a large role in economic worth of an oil field because porosity determines oil production rate. An oil supply with 20 percent porosity produces a profitable well and short payout.

Geologists assign risk to each contributing factor of a find: the source rock, the seal rock, the reservoir rock, the trap, and the timing; they assess overall risk as the product of risk associated with each factor. John Carmony, an independent contractor and wildcatter (someone who drills for oil far from producing wells), reports only a 10 percent success rate drilling in West Texas. “But that’s the best day of your life when you find oil, and the rig starts producing,” Carmony said (3). The high-paying success of Carmony and many other geologists outweighs all of their failures.

In addition to calculated risk, however, uncertainty of how much oil is in a field plagues the industry. “You never really know how much is there until you drain the last drop,” Carmony said (3).

In the wake of an energy crisis, the search for the earth’s remaining large, economic oil fields continues. Today, a combination of geochemistry, geophysical methods, and geomorphology reduce the risk of revisiting and reworking oil-producing regions.

Early 20th century decisions of where to drill exploited structural geology, focusing on the basic idea that buoyant oil migrates to structural highs, or anticlines, where it is trapped. According to geologist Paul Nadeau Ph.D., the Golden Zone, a temperature zone from 60 to 120 degrees Celsius, is home to the majority of the world’s economic oil resources (1).

Moreover, Nadeau asserts that only structural and stratigraphic traps, oil traps created by rock layering and rock type, within this temperature range are viable. Depending on the regional geothermal gradient, which describes the increase in temperature as a function of depth (ranging from 20-30 C/-km), the temperature range corresponds to different depths and is on average 2 km thick (1).

Below 60 degrees, the microbial process of biodegradation turns crude oil into less valuable tar.   At above 120 degrees, Nadeau argues that excessively high pore pressure equal to lithostatic pressures create rock failure and open up migration pathways for oil to move upwards, into the golden zone. Within the Golden Zone, however, quartz cementation in sandstones and fibrous illite formation in clays provide excellent rock seals, trapping hydrocarbons where they can safely mature. Although the majority of oil reserves have been found in the Golden Zone, data from  the Gulf of Mexico suggest that Nadeau’s model may not explain the relationship between pressures in wells at depth.

Nadeau believes that the key to finding oil is geothermal temperature gradient, but Dartmouth alumnus 1972 Patrick Ruddy Ph.D., relies on three-dimensional seismic imaging. Ruddy boasts a 70 percent rate of success applying three-dimensional seismic technology in Hungary, a region where only two-dimensional seismic had previously been used. Seismic technology distinguishes rock type by density at a resolution of 10m using p-wave (the primary and fastest seismic waves) refractions to map unconformities, rock formations and major faults. Exploding dynamite or vibrosis trucks create p-waves that travel down into the earth.  Changes in densities refract the p-waves, and receivers stationed at set distance from the wave’s source, record its travel time. Distance of the receiver from the source is accounted for to create a subsurface map where ‘distance’ represents time. While shooting two-dimensional seismic requires piecing together a puzzle in order to gain an idea of the geology, three-dimensional seismic uses receivers radiating from the source to give geologists a more complete understanding of structure. (6)

A third exciting development in off shore oil fields is the application of geomorphology. Deep-sea turbidity sands have lead to offshore oil discoveries in current and ancient depositional environments off the coast of Brazil and West Africa. Typically, turbidity sands create reservoirs and stratigraphic traps in structural lows (originally overlooked in favor of structural highs) where reservoir sands can accumulate (6).

Geomorphologists often work with geophysicists and seismic data to make sense of these subsurface depositional environments.

Applying new technology in a region can decrease the inherent risk of petroleum geology, which most often includes drilling dry holes or uneconomic wells and the potential danger to expensive equipment and workers when working deep reservoirs. The industry, however, may require constant innovation for the rate of discovery to equal the rate of production. Equally important, the sprint to the finish may leave the Unites States in last place unless other energy resources are developed.

1. P. Nadeau, “The Golden Zone Distribution of Hydrocarbons in Sedimentary Basins: A global View” (2008) Speech Delivered at the Hanover Inn, Hanover. 23 Oct. 2008.
2. J. D. Edwards, AAPG Mem. 74, 21-34 (2001).
3. J. Carmony, “Failure and Success in the Oil Patch” (2008) Speech Delivered at the Hanover Inn, Hanover. 30 Oct. 2008.
4. D. Blume, [Biofuel] David Blume Debunks Pimental (2007). Available at http://www.mail-archive.com/sustainableorgbiofuel@sustainablelists.org/msg71532.html (19 November 2008).
5. D. Deming, AAPG Mem. 74, 45-55 (2001).
6. P. Ruddy, “Geologic Exploration-Seismic Interpretation” (2008) Speech Delivered at the Hanover Inn, Hanover. 6 Nov. 2008.