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I don't get it. The article states that the Ghawar is "the world’s largest conventional oil field", and "can produce a lot less than almost anyone believed", a
by aliswe 8y ago
I don't get it.
The article states that the Ghawar is "the world’s largest conventional oil field", and "can produce a lot less than almost anyone believed", and is in fact "able to pump a maximum of 3.8 million barrels a day -- well below the more than 5 million that had become conventional wisdom in the market"
The saudi "12 million b/d capacity" was known from before, I assume, so isn't the surprise that other fields make up a larger percentage than "guessed"?
Then how can it be "fading faster than almost anyone believed"?
And, isn't slower fading of their biggest reserve a good thing?
- foota 8y agoMaybe the issue is the production fading, rather than the reserves? Any amount of oil in the ground doesn't do much for you if you can only extract it very slowly.
- 0815test 8y agoGenerally extracting oil slowly is a good thing, it increases the total amount you're able to pull out of the ground. Increasing immediate flow means having to do things like pumping water into the field to increase pressure, and getting an increasingly watered-down mixture back out. Things that involve a pretty huge increase in complexity.
- benj111 8y agoPumping rate tails off as the extractable oil drops, so the fact that it's dropping off faster than expected in their biggest oil field is notable.
- JamesBarney 8y agoLook up oil and gas decline curves and you'll see that a faster declining oil production means you'll get a lot less oil out of the ground over the next 10 and 20 years. And given a reasonable discount rate of 6% mean oil in 10 years is worth half of oil today and oil in 20 years is worth a quarter. You also run into efficiency issues. Running a high volume rig much more expensive than running a low volume rig.