California Petroleum

An interesting story on oil and gas production in CA. Some of the older fields
have water cuts of upwards of 95%!.
ken piers

 
The Oil Daily, June 25, 2004 v54 i121 pITEM04176006
California Oil & Gas Output Slips as Fields Show Their Age. (revenues and
output) David Knapp.
Full Text: COPYRIGHT 2004 Energy Intelligence Group

NEW YORK -- California's oil and natural gas production slipped in the first
quarter, according to data released this week by the California Department of
Conservation, as onshore fields in the central California San Joaquin Basin
continued to show their age.

California is the third largest oil producing state, after Alaska and Texas,
and is home to four of the ten largest oil fields in the country -- Belridge
South, Midway Sunset, Kern River and Elk Hills, based of proved liquids
reserves. All four of the California giants were discovered by 1920.

Average crude oil production for the first quarter dropped to 736,000 barrels
per day compared to 748,000 b/d in the previous quarter and 769,000 b/d in the
first quarter of 2003, an annual decline of 4.4%. Production in March was
731,000 b/d, off 10,800 b/d from February. Quarterly offshore output was more
stable than onshore production, with fields in both Federal and state waters
dropping by less than 2% on the year, while onshore fields lost close to 5%.

The largest fields, in central California's Kern County, generally suffered
the biggest declines. California's largest field, the 125,000 b/d Midway-Sunset
heavy oil field, declined by 6.8%, while neighboring Kern River, the state's
third largest, lost 7% for the quarter compared to a year earlier.

Although high oil prices have boosted revenues, the high cost of natural gas
-- much of it delivered from Wyoming through the Kern River Pipeline -- has
inhibiting increased pumping.

Without greater steam generation, natural declines and an increasing amount of
water produced with the oil -- Midway Sunset's water-cut was 81.6% in March and
Kern River's 89.7% -- continue to take oil production down.

Water cuts are also very high for aging offshore fields in state waters. The
1932-vintage Wilmington field off the southern California coast, by far the
largest of the state's seven offshore fields and accounting for 75% of state's
offshore crude production, has a water cut of over 96%. That means that for
every 100 bbl of liquids extracted from the ground, less than 4 bbl are oil.
The remaining 96 bbl are water.

The offshore portion of the 7,000 b/d Huntington Beach field, discovered in
1904, has a water-cut of 95%.

There are also 11 fields further offshore in Federal water further to the
north in the Santa Barbara Channel contributing 75,000 b/d to first quarter
output. These fields have been producing for a much shorter period of time and
have lower water-cuts, but are also showing their age.

The state's natural gas production did even worse than oil, declining by 8.2%
to 895 million cubic feet per day, compared with the first quarter of 2003.
March production dipped to 876.5 MMcf/d. About three-quarters of California's
gas production is associated with oil operations.
 
 

Ken Piers

"Everything should be as simple as possible - but not simpler." A. Einstein