How Deep Can We Find Economic Oil and Gas Accumulations?

American Institute of Mining, Metallurgical, and Petroleum Engineers, Inc. This paper was prepared for the Deep Drilling and Production Symposium of the Society of Petroleum Engineers of AIME, to be held in Amarillo, Texas, Sept. 8–10, 1974. Permission to copy is restricted to an abstract of not more than 300 words. Illustrations may not be copied. The abstract should contain conspicuous acknowledgment of where and by whom the paper is presented. Publication elsewhere after publication in the JOURNAL OF PETROLEUM TECHNOLOGY or the SOCIETY OF publication in the JOURNAL OF PETROLEUM TECHNOLOGY or the SOCIETY OF PETROLEUM ENGINEERS JOURNAL is usually granted upon request to the Editor PETROLEUM ENGINEERS JOURNAL is usually granted upon request to the Editor of the appropriate journal provided agreement to give proper credit is made. Discussion of this paper is invited. Three copies of any discussion should be sent to the Society of Petroleum Engineers office. Such discussion may be presented at the above meeting and, with the paper, my be considered for publication in one of the two SPE magazines. Abstract The development of drilling equipment with increasingly greater depth capability should take into account the maximum depths at which economic hydrocarbon accumulations will be found. The origin, accumulation and destruction of hydrocarbons is controlled primarily by temperature and time. Most hydrocarbons form at primarily by temperature and time. Most hydrocarbons form at subsurface temperatures ranging from 125 degrees F to 350 degrees F, equivalent to depths of 3,500 ft. to 20,000 ft. in a typical basin. High temperatures (greater than 350 degrees F), or long exposure to moderate temperatures will ultimately destroy oil yielding mainly graphite and methane. Eventually, even commercial accumulations of methane are absent. Each sedimentary basin has a characteristic hydrocarbon limit, beyond which drilling is futile. ECONOMICS OF DEEP DRILLING In 1973 there were 506 wells drilled deeper than 15,000 ft. at a cost of over half a billion dollars (Scott). The average deep well cost $1,107,000 compared with about $900,000 in 1972. Although deep drilling costs have increased rapidly in recent years, this has not always been so. From the early 1950's until about 1966 the average cost oscillated around $40 per foot, as shown in Figure 1. This was partly due to the remarkable improvements in drilling technology, particularly in the number of bits required for deep drilling. This decreased from a high of around 200 bits per well in the late 1940's to only 38 bits per well last year. Since 1966 improvements in drilling technology have not been sufficient to offset rising costs, and for the ultradeep wells below 20,000 ft., the cost rise has been particularly steep. Today six wells can be drilled to 15,000 ft. particularly steep. Today six wells can be drilled to 15,000 ft. for each well that is drilled to about 30,000 ft. as shown in Figure 2. There is no question that drilling in the 15,000 to 20,000 ft. range is justified. Last year 31% of the wildcats were successful, which is high by most standards. The real question is, how much deeper than 20,000 ft. can we drill profitably? From 1944 through 1958 the deepest production generally lagged behind the deepest well by about 3,000 ft. as shown in Figure 3. In 1959, this gap began to approach 5,000 ft. and this year it exceeded 8,000 ft.