Remaining Oil & Natural Gas Resources of New Mexico

Remaining Oil & Natural Gas Resources of New Mexico

Ron Broadhead

New Mexico Bureau of Geology & Mineral Resources

A division of New Mexico Tech

Key Questions

• How much extractable oil and gas is left in New Mexico?

• How long will production last?

Resource CategoriesResource category

Definition Confidence level

Proved reserves Already discovered mostly drilled

High

Undiscovered resources – productive trends

Undiscovered but along known trends

-undrilled

Medium

Undiscovered resources-

new trends in productive basins,

new basins

Undiscovered trends in well known

productive basins

New basins

(poorly known)

Undrilled

Low

Natural Gas

• Production history

• Reserves

• Resources

• How long?

Natural Gas Resources

Resource type

Gas (TCF) Source

Proved reserves 17.3 EIA/DOE

Undiscovered resources

51.2 USGS

Undiscovered resources

72.1 PGC

Total resource base

68.5-89.4

How long will this last at present rates of production

(1.6 TCF/year)?

Proved reserves 10.8 years

Undiscovered resources 32-45 years (providing estimated gas is explored for, discovered & brought online)

Production History, U.S. Gas

From Potential Gas Committee (2000)

Reserve Life Index

_Proved reserves_Annual production

Crude Oil

• Production history

• Reserves

• Resources

• How long?

Oil Resources

Resource type

Oil (MMBO) Source

Proved reserves 705 EIA/DOE

Undiscovered resources

776 USGS

Total resource base

1481

How long will this last at present rates of production

(67 MMBO/year)?

Proved reserves 10.5 years

Undiscovered resources 11.5 years (providing estimated oil is explored for, discovered & brought online)

Production History, U.S. Oil

First Conclusions

• The Reserve Life Indices for oil & gas have remained surprisingly stable over the last 20 to 30 years

• Oil and gas resources have been moved from the undiscovered category to the discovered category at a rate approximately equal to production

• Undiscovered resources have been underestimated

So how have oil & gas been added to the resource base to keep the Reserve Life Indices from falling through the floor?

Some notable examples…

Recovery enhancement

Waterflooding/pressure maintenance-Vacuum Grayburg San Andres reservoir

From current work on DOE/PUMPproject –Digital analysis & portfolioof oil reservoirs in Permian Basin

Redevelopment of old fieldse.g. Dagger Draw

Effect of Dagger Draw on NM Production

Additional resources through new playsBrushy Canyon discoveries

From current work on DOE/PUMPproject – Digital analysis & portfolioof oil reservoirs in Permian Basin

Additional resources through new unconventional gas

Other Emerging Possibilities

• Horizontal drilling in old fields (San Andres, Yeso Fms., SE NM)

• Unconventional gas sources (incl. shale gas, low K carbonates)

• New basin production (Raton coalbed methane, other areas)

Second ConclusionsWhat will it take to keep the decline in check?

• Renewal of old fields through redevelopment, EOR, etc.

• Discovery of new plays

• New sources of unconventional gas

• All of the above have their role

And above all…

Drill

Drill

Drill