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Valuing Venezuela’s Orinoco Oil Belt

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Written by William Walter Kay; Originally appeared at Global Research

Heavy Oil and Tar Sands

While much is heard of “fracking” these days; steam-injection may in the long run prove to be the petroleum industry game-changer. Steam aids in harvesting heavy oils from sprawling oil-rich sand and clay formations where the oil is too viscous to be worked by conventional pumps. 

Valuing Venezuela’s Orinoco Oil Belt

Initially, all heavy oil (Alberta) was extracted via open-pit mines wherein giant shovels heaved mounds of oil-saturated sand onto giant dump-trucks for transit to separating vats filled with hot water. This method has largely given way to steam-injection. In Alberta’s oilsands, where much of this technology originated, heavy oil is now 80% extracted via steam; 20% via mining.

The simplest form of steam injection uses a single well. A hole is drilled down to a heavy oil deposit; then steam is pumped down the hole, sometimes for months. Eventually a blob of oil concentrates near the well’s bottom of sufficient viscosity to enable pumping to the surface.

Circa 1978 SAGD (Steam Assisted Gravity Drainage) emerged. With SAGD two lengthy perforated pipes are drilled into place horizontally through the deposit; one pipe a few metres above the other. Both pipes emit steam until a teardrop shaped oil bubble envelopes the lower pipe. Then the top pipe continues to emit steam while the lower pipe goes into reverse; drawing oil to the surface. In 2017 Alberta’s oilsands yielded 2.7 million barrels a day; mostly via SAGD.

Three additional innovations are coming to the fore.

Solvent-Assisted SAGD adds designer chemicals (solvents) to the steam-injection process to accelerate the loosening up the oil.

DHSG (Downhole Steam Generation) lowers small but mighty steam generation tools (furnaces) deep into the well. DHSG allows for greater heat conservation and improved fuel economy.

Miniature nuclear reactors are ready for commercial application. Toshiba has developed a prototype reactor specifically for heavy oil extraction. This 5 MW electricity generator simultaneously serves as the furnace for a 900 Celsius steam injection boiler. The reactor promises to replace the elaborate and expensive natural gas infrastructure presently required by oil-field steam injection facilities. Toshiba’s prototype needs refueling every 30 years.

Venezuela’s Orinoco Oil Belt

The world’s fourth largest river, the Orinoco, rises in the Parima Mountains along the Venezuelan-Brazilian border. The Orinoco engraves a 2,000 kilometre north-easterly arc through Columbia and Venezuela before discharging into the Atlantic Ocean off Venezuela’s coast. The Orinoco Heavy Oil Belt stretches 600 kilometres along the north bank of the Orinoco River’s easterly dash to the sea. The Belt is 70 kilometers wide.

Valuing Venezuela’s Orinoco Oil Belt

United States Geological Service’s (USGC) Estimate of Recoverable Oil Reserves of the Orinoco Oil Belt (2009) is the go-to source regarding the Orinoco reservoir’s size. After describing how this oil-saturated bed of sandstone ended up 150 to 1500 metres below the surface of the East Orinoco Basin; the authors estimate “oil-in-place” to be up to 1.4 trillion barrels.

The Belt’s “technically recoverable” oil is estimated to be as much as 652 billion barrels. Elsewhere, however, the report speculates that by fully exploiting SAGD, and other recovery enhancement processes, 70% of the oil-in-place might be extracted. Moreover, the report relies on studies published between 2001 and 2008 hence does not contemplate: Solvent-Assisted SAGD; Downhole Steam Generation; let alone the application of nuclear power. Tackling the Orinoco Belt with these technologies will yield a trillion barrels.

The report does not discuss production costs. Canadian oilsands companies continued to produce in 2018 even after transportation bottlenecks tanked prices to $20 a barrel. These facilities, however, would not have been built had investors known this might be the price of their wares. The business press guesstimates the current breakeven price for an Alberta oilsands project to be around $35 a barrel.

While the Orinoco Belt is not as large as Alberta’s oilsands it has three advantages:

a) its oil is not as heavy;

b) its climate is far hotter; and

c) it’s much closer to a coast.

The Orinoco Belt sits at 9 degrees latitude and its entire span is a few hundred kilometres from Atlantic shores. Orinoco Belt production costs will be noticeably lower than Alberta’s oilsands.

Let’s place 1 trillion barrels of oil in context.

Global oil consumption is currently 35 billion barrels a year. Thus, the Orinoco Belt alone could satisfy 100% of global demand for almost 30 years!

As for the Orinoco field’s dollar value. World oil prices are currently hovering near $60 …do the math.

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Pave Way IV

Orinoco Belt production costs will be noticeably lower than Alberta’s oilsands.

Theoretically. Consider that about half the employees of PDVSA have quit by now because their pay (in Argentine pesos) is equivalent to a few dollars a week – and that’s for degreed professionals. Those that left are never coming back, so Argentine oil companies will have to hire high-priced foreigners or foreign oil companies (who are paid in dollars) in the future. Half the oilfield equipment and infrastructure is inoperable due to lack of spare parts and theft of anything of value – especially copper wire. It will take billions just to get back to 2014 production levels, and far more to produce any new wells.

If Argentina could wave a magic want and restore the one million barrels a day lost in production in the last couple of years, it would still take them 55 years to pay off their PDVSA and state debt – that’s if every cent of profit went to the banks/bondholders. The real gold mine in Venezuela is debt, not oil.

RichardD

According to the book Alien Mind by George Lobuono which I’ve read, which is primarily about telepathy. “Free” energy from the ether isn’t free. While it, according to his purportedly alien sources, is indeed recoverable. Extracting too much of it prematurely ages the sector of space that it’s drawn from, killing the stars and planets in that area. However, the energy consumption rates required to cause damage are exponentially higher than what our civilization currently uses.

How true this I don’t know. Looking at other civilization’s history and constructs is one of my goals in ET/ED contact work.

PZIVJ

This does sounds like entropy, converting to much potential energy into dissipated and useless heat. Good thing the stars have a lot of mass, so it will take a while. But not so much the fossil fuels.

RichardD

Thorium and Helium 3 alone can potentially power the planet’s needs for thousands of years if they can be utilized.

PZIVJ

I was surprised to learn that Helium is extracted from natural gas fields (CH4)
Sometimes as much as 10% of volume !!

RichardD

The charge material is available for both Thorium and Helium 3, the constraining factor is the current state of reactor technology. With Helium 3 fusion isn’t functional yet. With Thorium, which is a fission reaction. The reactors work, but aren’t cost competitive, in part because they don’t produce nuclear weapons material and have been suppressed and received less investment that would make them cost competitive.

“Unlike most other nuclear fusion reactions, the fusion of helium-3 atoms releases large amounts of energy without causing the surrounding material to become radioactive. However, the temperatures required to achieve helium-3 fusion reactions are much higher than in traditional fusion reactions”

– Helium-3 –

https://en.wikipedia.org/wiki/Helium-3#Natural_abundance

“one ton of thorium can produce as much energy as 200 tons of uranium, or 3,500,000 tons of coal …

Thorium could provide a clean and effectively limitless source of power while allaying all public concern—weapons proliferation, radioactive pollution, toxic waste, and fuel that is both costly and complicated to process”

– Thorium-based nuclear power –

https://en.wikipedia.org/wiki/Thorium-based_nuclear_power

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