Oil is well

Oil is well
Oil sustains life. We cannot conceive of living with ease on this planet without

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petroleum products. Whether it’s for moving from one place to another in a car, aeroplane, a train or a bus, we are dependent on the black gold. It helps produce our food through fertilisers and our power. It keeps homes cool or heated, removes our headaches through aspirin and is used to inject medicines through syringes, produces antiseptics, anesthetics, antihistamines, cortisones and allergy medicines.

It’s use is so ubiquitous that we almost don’t notice it. It’s present in heart valves, hearing airds, ear plugs, mosquito sprays, computers, wires, phones, calculators, erasers, cameras, golf balls, soccer balls, skis, boats, snorkels, luggage, shoe polish and cigarette filters. It zips up trousers, holds up bras, keeps babies clean through diapers, protects our eyes through dark glasses, and is part of tape recorders, water pipes, floor wax, spray paint and garden hoses. It’s presence may not be felt in colognes, perfumes, lipstick, mascara, shampoo. hair spray and hand lotions, but it is there.

Yet, people want to get rid of petroleum use. As the environment lobby gains ground, it wants to get rid of fossil fuels and replace it with renewable energy sources. Yet, petroleum is used in thousands of products for human beings, many crucial, some ornamental. It’s use is not going to go away in the foreseeable future. So the next best thing is to make its production more efficient and lower price.

For that, technology is paramount. As India moves towards freeing oil prices to reflect market rates, a silent revolution of sorts is going on to improve the efficiency among upstream companies, to meet the growing demands of the world’s largest democracy. With the India growing at a fast clip, demand for petroleum products is likely to increase from 120 million tonnes in 2006 to 142 million tonnes by 2011-12. It has become necessary for exploration companies to bring new assets under production, which is possible only through technological development.

Just before retiring on January 31, R S Pandey, former petroleum secretary, urged all scientists in the sector to come together and prepare to face the emerging challenges of the country. On similar lines, deputy chairman of planning commission Montek Singh Ahluwalia has said that, “Giving boost to technology innovations is high on government’s agenda.”

According to International Energy Agency (IEA) by 2030, global energy demand is expected to increase by 50 per cent from its current level. Oil and natural gas are expected to remain primary energy sources and are expected to meet 52 per cent of the global demand.

Natural decline in production from the matured fields is a global phenomenon. PFC Energy in its report has mentioned that non-Organisation of the Petroleum Exporting Countries (OPEC) fields, have declined at an average rate of 9.4 per cent a year since 2000. Most of India’s oil field, operated by Oil and Natural Gas Corporation Limited (ONGC) and Oil India Limited (OIL), are nearly four to five decades old.

Chairman and managing director of ONGC R S Shama says that against the backdrop of the PFC report, one should appreciate that the fifteen major fields of ONGC, accounting for 77 per cent of total ONGC’s production and having an average life span of 25-30 years, have registered a 1.6 per cent increase in 2007-08 over 2000-01.

He says all this was possible due to high-tech interventions through improved oil recovery (IOR) and enhanced oil recovery (EOR) schemes. “These schemes helped us in improving recovery factor of these fields from 28 per cent in 2000 to 33.1 per cent in 2008-09. We intend to increase the global recovery factor to 40 per cent by 2020 and these matured fields will continue to contribute for sufficiently long period,” said the Sharma head of of country’s largest public sector enterprise.

ONGC is investing more than Rs 50,000 crore in developing new hydrocarbon fields in addition to increasing productivity of existing fields. The company has spend close to Rs 14,000 crore on the two new technologies till 2009.

When output in an oil field nears close to 25 per cent of the total reserves, the economic viability of drilling more oil becomes tougher. After arriving at such a stage, companies start using enhanced oil recovery schemes, which includes injected water through an alternate well drilled near the production well, helping to maintain the pressure in an underground reservoir. Water flooding helps displacing the crude, which in turn increases output. Depending on the quality of crude and its viscousness, steam, gas or even chemical solutions can be used.

The country’s second largest upstream public sector oil company, Oil India uses technology extensively to boosts its exploration activities. The company is exploring 27 blocks in the country. “Our success rate of exploratory wells is more than 65 per cent. We integrate satellite information, seismic attribute analysis, source rock evaluation and techno-economic evaluation among others as its tool for exploration and production activities,” said an official with the technical department of OIL, who did not want to be named.

Cairn India, the private producer of crude from country’s biggest onshore field, has built its business on what it calls innovations and pioneering technology to stay ahead in an environmentally responsible manner. “We have applied technology and gained significant operational experience, be it in deserts of Rajasthan, highly populated plains of Bihar, in the Himalayan foreland or shallow water of Cambay,” said a Cairn official.

The subsidiary of UK’s Cairn Energy has been using geophysical tools such as spectral decomposition to map the complexity of reservoirs which are beyond seismic resolution. It has drilled and completed horizontal and near horizontal wells in the Cambay offshore. The company claims to have used expandable sand screen techniques for the first time in the world on a sea bed in the Gauri fields, off the Gujarat course, resulting in huge cost-savings.

It has also flagged off a programme of 4D or time lapse seismic survey of leftover oil in fields. “At Ravva, Cairn introduced first of its kind technology such as coiled tubing, which was never implemented in South East Asia or West Asia,” said the official.

Growing demands for petroleum products is not only compelling upstream companies to burn their midnight oil, so to say, but refiners have also contribute their share.

Already, the fifth largest country in the world in terms of refining capacity, with a share of 3 per cent of the global capacity, India is likely to boost its refining capacity by 45 per cent or 65 million tonne per annum over the next five years, according to a Deutsche Bank report. Indian companies plan to increase their refining capacity to 242 million tonnes by 2011-12 from about 149 million tonnes in 2007.

Indian Oil Corporation, country largest oil marketing company and second largest refiner, has made several technological innovations at its research and development centre. These have improved the efficiency of its own refineries and the company licensed the technologies and catalysts developed in-house to refiners overseas.

According to Anand Kumar, director R&D at IOC, the company has patented a technology called Indmax to produce liquefied petroleum gas from heavy petroleum fractions. It’s in the process of setting up a four million tonne per annum Indmax plant at Paradip in Orissa. It has also developed diesel hydro desulphurisation unit that helps production of extra low sulphur diesel.

As many companies join the green race, developing alternate source of energy has become the latest buzzword. IOC has launched several initiatives to exploit energy sources such as hydrogen and bio-fuels, says Kumar adding that its R&D team is working on production, storage, transportation, distribution and commercialisation of hydrogen. Cairn India has installed a solar plant for remote management of the well head at the Ravva offshore and a 400 watts wind generator has been installed to lower diesel consumption even on cloudy days.

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