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 THE
UNITED STATES
North America
The US has been the world’s largest oil and gas producer.
Although three quarters of its output comes from onshore, offshore is a
growing influence as fields are developed in the deep waters of the Gulf
of Mexico.
 The
US oil industry has been a pioneer of technologies onshore and offshore,
and in extreme climates. Particularly since the discovery of the
Spindletop field in 1901 it has driven the oil price, firstly by supply
means, before OPEC took over this role, and latterly due to demand
needs (now superseded by China). Furthermore, perhaps surprisingly to most Europeans, it has
pioneered environmentalism in the industry, restricting exploration in
areas deemed environmentally fragile.
The oil industry began in Pennsylvania, where Colonel Drake drilled the
first well in 1859. It was not a prolific basin as production had begun
to decline by 1900 but it was the birthplace of Standard Oil.
Speculative activity soon led to other oil plays being developed in
Illinois, Oklahoma and California but it was in Texas, where the
Spindletop well was drilled on New Year’s Day 1901, that oil, and then
gas, became key US resources. Oil and gas are now produced, to a greater
or lesser extent, from most states.
The Gulf of Mexico: The only
area from which production is climbing is the Gulf of Mexico. It is a
rift basin that formed when South America began to break from North
America. However, unlike the Atlantic, it did not turn into an actual
ocean, floored by oceanic crust. It was later rifting east of Florida,
beginning around 120 million years ago (the Early Cretaceous) that led
to the successful break up of the Euro/African continents from the
American continents to create the Atlantic Ocean.
 As
the Gulf of Mexico formed so lakes were created that were ideal for source rocks.
These were flooded by seawater, which evaporated, and thick salts were
then
deposited. When rifting ceased the Gulf’s shelf regions began to
accumulate reservoir carbonates in the shallow seas or reservoir
turbidites on the deepwater slopes. The turbidites were outfall from the
Mississippi and other large rivers that flowed into the basin.
The
low-density salt began to move under the weight of overlying sediments
to produce complex traps as well as sub-basins, which accumulated
additional source rocks. Conditions in these rifts were ideal for the
accumulation of substantial quantities of hydrocarbons.
Drilling in the Gulf of Mexico began in 1937, a natural
extension of the activities of companies exploring and producing in
Louisiana and Texas. Many relatively small, low productivity oil and gas
fields were discovered on the shallow water shelf. The rapid development
of these fields was possible because the area, with its energy hungry
hinterland, held diverse opportunities for investment under a
competitive cost environment.
Operators vied for markets whilst service contractors
competed on price for contracts. The network of oil and gas pipelines
created near the edge of the shelf also ensured a rapid and relatively
cheap development of deeper and deeper waters. All phases of exploration
and development activity are moving steadily into deeper waters and oil
production here is increasing solely as a result of new deep water
developments.
Alaska: There are two
areas in Alaska with oil and gas production, the Cook Inlet in the
southwest, and the North Slope in the extreme north of the state. Other
onshore areas with potential in Alaska are the National Petroleum
Reserve-Alaska (NPR-A) and the Alaska National Wildlife Refuge (ANWR)
but these areas of the North Slope are environmentally protected and
activity is limited.
First commercial oil production from Alaska began in
1959 at the Swanson River field onshore of the western Cook Inlet. Gas
was also produced from this field but most has been re-injected. Further
discoveries were made on both sides of the Cook Inlet and in 1962 Pan
American discovered oil offshore. The first major gas discovery in the
Cook Inlet was the Kenai field in 1959, and offshore gas was first
produced in 1966 in association with oil.
Oil production on the North Slope began in 1969 at Prudhoe Bay.
Production was initially restricted to small quantities used to fuel
field operations until the Trans Alaska Pipeline System (TAPS) was
completed in July 1977. Dissolved gas and water are separated from the
crude oil in Prudhoe Bay and injected back into the reservoir. Nearly
all Alaska’s oil has come from the Prudhoe Bay and smaller Kuparuk
fields although both are in serious decline.
Gas production on the North Slope began near Barrow in the 1940s in the
NPR-A to fuel a military base but around 95% produced in the Prudhoe Bay
area is re-injected with the remainder consumed locally to fuel oil
field equipment, operations, and pipelines. Eventually gas will be moved
south by pipeline.
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