Casinghead Gas Research Articles

Developments in South Texas in 1954

Drilling activity in South Texas for 1954 was down 4% from the previous high in 1953, yet was still greater than any other year. Wildcat drilling decreased 6.1% and development drilling decreased 3.2%. However, the 118 discoveries were 7% more than in the previous year and the discovery ratio was raised slightly. No major reserves are indicated from these discoveries, but extensions and new-pays have added considerable reserves. Oil production was down 7% due to decreased allowables. Gas and liquid hydrocarbons produced were up 10%. Production in 1954 amounted to 150,314,031 barrels of oil, 28,113,943 barrels of liquid hydrocarbons, 467 billion cubic feet of casing-head gas, and 1,376.8 billion cubic feet of gas.

Allocation of Costs Between Petroleum Liquids and Gases

Introduction Petroleum producers have been engaged for many years in supplying several different types of materials from the leases they operate. Some leases produce crude oil and casing-head gas, others produce gas-well gas and condensate, and still others produce all four of these materials. Therefore, the problem of allocating costs between these intermingled products is not a new one. While in some fields gas has been the dominant product, most producers have been interested principally in oil. Consequently, little has been done about the cost allocation problem by oil producing companies. For accounting purposes, these companies have generally considered gas a by-product, and whatever realization was obtained from it was accounted for as a reduction of producing costs, which were all considered to be applicable to crude oil. The inadequacy of this procedure under present day conditions, and the need for a more realistic approach to the problem of accounting for costs, can probably be illustrated best by a brief review of the growing importance of gas in the economic structure of the industry. Need for Allocation Known natural gas reserves in the United States approximately doubled during the 10 years ending with 1952, rising to a total of nearly 200 trillion cu ft at the beginning of 1953. In terms of heat value the 200 trillion cu ft of gas is approximately equal to the combined heat content of the 28 billion bbls of crude oil and the 5 billion bbls of condensate in reserve at the beginning of 1953. However, the heat units produced in the form of oil in 1952 were almost twice as great as those produced in the form of gas - a good indication that there is much more room for expansion in production of gas than for crude oil. The rapid growth in demand for gas since the end of World War II has brought about a substantial increase in the wellhead price, despite increasing reserves. In the Southwest, for instance, the price doubled in the period from 1943 to 1951, rising to an average of approximately 5.6 cents a thousand in the latter year. Marketed production of gas in the United States had increased to a rate of about 7.5 trillion cu ft in 1951 and over 8 trillion in 1952. The increase in demand thus indicated has been close to 12 per cent a year since 1946, more than twice as great as the rate of increase in demand for crude oil.

Developments in Southeastern States in 1952

In the states of the Southeastern District--Alabama, Florida, Georgia, and Mississippi--2,253 geophysical and core-drill crew-weeks were worked in 1952. This was an increase of 1,084 crew weeks over the total for 1951. The total number of wildcat wells increased from 175 in 1951 to 241 in 1952, while development wells decreased from 261 in 1951 to 193 in 1952. The increased exploratory effort resulted in the discovery of 19 new fields and one new salt dome. Drilling in and near established fields resulted in 11 new pools and 5 extensions to fields. Total oil and distillate production for the year was 38,018,918 barrels. Gas production was 171,694 MMCF in Mississippi with only small unrecorded amounts of casinghead gas produced in Alabama and Florida. Forty-two wildcat wells were drilled in Alabama in 1952, resulting in one new oil field. In all, 25 development wells were completed as producers and 4 as dry holes. Drilling in the Pollard field resulted in the discovery of 2 new pools. Yearly production of 1,151,236 barrels of crude oil brought the cumulative total to 4,931,097 barrels. The geophysical and core-drill crew-weeks totaled 651, an increase of 340 over the 1951 figure. In Florida 10 wildcat wells were drilled during the year with no new discoveries. No development wells were drilled. The yearly production of crude oil was 591,855 barrels, bringing the cumulative total to 2,743,462 barrels. Geophysical and core-drill crew-weeks jumped from 46 in 1951 to 485 in 1952. No wildcat wells were completed in Georgia at year's end and no geophysical or core-drill crew-weeks were reported for the state. In Mississippi 189 wildcats were drilled, resulting in 16 new oil fields, 2 gas fields, and one new salt dome. Development in proved to semiproved areas totaled 164 wells. This figure represents 93 producers and 71 dry holes. Included in the producers are 9 new pools and 5 field extensions. Oil and distillate production for the year was 36,275,827 barrels, a decline of 3,657,173 barrels. Cumulative oil and distillate production to date is 365,766,687 barrels. A total of 171,694 MMCF gas was produced, bringing the cumulative production for gas to 744,203 MMCF. Geophysical and core-drill activity jumped from 812 crew-weeks in 1951 to 1,117 in 1952.

East Village Mills Field, Hardin County, Texas: ABSTRACT

This field was discovered in June, 1949, with the completion of the Houston Oil Company-American Republics Corporation's Nona Fletcher Mineral Company No. 1 through perforations from 7,058 to 7,066 feet in the lower Yegua. It is located on a relatively low-relief anticlinal fold on the downthrown side of a down-to-the-south regional fault, which has 100-200 feet of throw. As of October 1, 1951, two years and four months after the discovery well, there are 141 wells producing from eight reservoirs in the middle and lower Yegua sands. Total production has been 4,568,905 barrels of oil, 3,731,711 MCF of casinghead gas, 131,850 barrels of condensate, and 3,063,909 MCF of non-associated gas. End_of_Article - Last_Page 2625------------

Developments in South Texas in 1949

Development in the South Texas district during 1949 reflected the general conditions of the domestic petroleum industry resulting from excessive imports of oil. All phases of development and production, except for gas production and the by-products of gas, were below the rates established the previous year. The 793 wildcat exploratory wells found 72 new producing areas, and 2 of the discovery wells were dually completed. Of the 1848 field development wells, 1220 were completed as oil producers, 330 as gas wells, and the remaining 20 per cent were abandoned. A net increase of 421 oil wells was noted during the year. The 17,159 oil wells in the district produced 125,238,744 barrels of oil, 44,500,210 barrels less than the amount produced during the previous twelve-month per od. Over 43 per cent of the oil wells in the area were serviced for casinghead gas. The liquids processed from all gas production amounted to 13,804,592 barrels, an increase of 12.3 per cent over condensates recovered during 1948. Gas transmission lines marketed 155 billion cubic feet of gas.

Developments in Oklahoma in 1948

Although fewer outstanding discoveries were made in undeveloped regions of Oklahoma during 1948, substantial reserves were added by wildcat discoveries and extensions especially on the southwest flank and in the southeastern embayment of the Anadarko basin, the Ardmore basin, the Seminole area, and in east-central Oklahoma. The outstanding development in Oklahoma during 1948, from a regional exploration point of view, was the continued success of exploratory drilling in the Elk City area, on the southwest flank of the Anadarko basin, which emphasized the geologic significance of granite wash production in Oklahoma. Discoveries in this area resulted in further leasing and exploration in the entire southwest Anadarko basin extending from Oklahoma into the Texas Panhandle. Production of oil increased to 155,578,453 barrels, representing an increase of 9.9 per cent over the 1947 production. Total reserves of crude oil increased by 31 per cent. Production of marketed natural gas increased to 276,542,084,000 cubic feet and casinghead gas to 178,751,567,000 cubic feet, or 12 per cent over the gas marketed in 1947. Total reserves of natural gas were estimated to be practically the same at 11,332,445 million cubic feet at the end of 1948. In number of holes drilled Oklahoma ranked second with a total of 3,827, of which 713 were wildcats resulting in 94 new discoveries. The deepest producing well in Oklahoma, one of the deepest in the world, was completed during 1948 in an Ordovician sandstone zone from 12,855 to 13,611 feet.

Developments in South Texas in 1948

The development in South Texas during 1948 showed a 23 per cent increase over the previous year. In all 2,987 tests, 2,158 wells in proved areas and 829 wildcat wells, were drilled and resulted in 1,915 successful completions. The exploratory development resulted in the discovery of 81 producing reservoirs in 79 new areas, 3 of the discovery wells being dual completions. The most important of the new discoveries are the Doering Ranch field in Frio County, the Holly field in DeWitt County, the South Long Horn field in Duval County, the San Pablo field in Jim Hogg County, the Quien Sabe field in Webb County, the East Long Mott field in Calhoun County, and the Sarita field in Kenedy County. Wells drilled in productive areas uncovered 155 new producing beds in 84 fields, the rio-Vicksburg trend accounting for 108 of the total. At the close of 1948 oil wells totaling 16,738 had produced 169,739,954 barrels of oil, 10 per cent more than had been produced from the area during the previous year. Thirty-six per cent of the oil wells in the South Texas district are now being serviced for casinghead gas.

Developments in South Texas in 1947

Development in the South Texas district during 1947 showed a 26 per cent increase over the previous year. In all, 2,386 tests, 1,758 wells in proved areas and 528 wildcat wells, were drilled and resulted in 1,541 successful completions. The exploratory development resulted in the discovery of 63 new producing areas, the Bloomington field of Victoria County and the Cam field of Duval County being the outstanding discoveries of the year. Wells drilled in productive areas uncovered 151 new producing zones, the Frio-Vicksburg trend accounting for 112. The new producing zones in old fields are probably of greater reserve importance than the new fields discovered in 1947. At the close of 1947, 15,775 oil wells in South Texas had produced 154,179,726 barrels of oil, 11 per cent ore than that of the previous year, and gas transmission lines had marketed 140,227,866 MCF of gas well gas and 5,980,000 MCF of casinghead gas. Seventy-six per cent of the oil produced in South Texas comes from fields of the Frio-Vicksburg trend.

Right of Purchaser of Casinghead Gas to Income Tax Deductions for Depletion

Right of Purchaser of Casinghead Gas to Income Tax Deductions for Depletion

Oil Recovery Investigations of the Petroleum Experiment Station of the U. S. Bureau of Mines

Problems Being Studied The selection of the first problems to be studied was based largely upon thefollowing very practical questions asked by several of the largest operators inthe Mid-Continent field.What are the causes for the formation of excessive amounts of bad thick oilon properties that are being repressured with compressed air and how can thistrouble be prevented?Why, in some areas, does the oxygen in the air injected into an oil sandduring repressuring operations apparently change to carbon dioxide? Is carbondioxide formed by the oxidation of some of the oil in the sand? How can theformation of inert or low B.t.u. casinghead gas, loaded with nitrogen, carbondioxide and oxygen, be prevented?What percentage of the oil originally present in an oil sand can berecovered by the ordinary methods of operation when the gas originallydissolved in the oil is the main propulsive agent?What percentage of the amount of oil produced by ordinary methods can berecovered under average conditions by repressuring a so-called depleted oilsand?What are the relative propulsive efficiencies of compressed air and naturalgas in repressuring operations?What are the practical advantages of pressure maintenance and earlyrepressuring as compared with late repressuring?

The Compression of Refinery and Casinghead Gases

The Compression of Refinery and Casinghead Gases

Gas-oil Ratio as Related to the Decline of Oil Production, with Notes on the Effect of Controlled Pressure

Gas-oil ratios in the production of oil have recently attracted theattention of production engineers throughout the country and much work has beendone in an effort to reduce the volume of gas produced with each barrel of oil, thereby increasing the ultimate oil production. When occasion arises to use therelationship of rate of oil production and rate of casinghead gas production ithas ordinarily been assumed to be within reasonably narrow limits constantthroughout the life of the property after flush production is past. Inoperating a lease for conservation of gas or more efficient methods of recoverythe rate at which the volume of casinghead gas is declining is as essential asthe rate of decline of oil production. Much work has been done on the rate ofdecline of oil production and while our knowledge of the subject is far fromcomplete it is much greater than our knowledge of the rate of decline of thecasinghead gas. The data presented show that a definite relationship existsbetween the rate of decline of oil production and volume of casinghead gas, andthat a study of this relationship will usually indicate the effect on thegas-oil ratio which may be expected when controlled pressure is applied. Comparison of two curves with different rates of decline is difficult unlessone is expressed in terms of the other. Therefore in the discussion whichfollows the relationship of the rate of decline of casinghead gas to oilproduction is expressed by the cubic feet of gas produced with each barrel ofoil, or gas-oil ratio. The subject of this paper might more appropriately be "The oil-gas ratioas related to the decline of casinghead gas." Where gas is the principalexpelling force of the oil from the sand, the oil is produced with thecasinghead gas rather than the casinghead gas being produced with the oil.Since oil production figures are more familiar and it is easier to follow fromthe known to the unknown, the more common usage is continued by expressing thecasinghead gas in terms of oil production, but it must be kept in mind that thereverse is the more exact condition.

Evaluation of Casinghead Gas

The conditions affecting the supply of casinghead gas, the different degreesof productivity, the difficulty of determining the quantities utilized, and theevaluation of the gas in casinghead-gasoline units and related data, having aneconomic bearing on the industry as a whole, are important questions and offeran interesting field for study. Casinghead-gas data have been gathered in some of the oil fields of Oklahomawhere testing work has been done regularly and the volumes of casinghead gaswere available. The area covered embraces 219 scattered leases in 29 townships, with a total of 18,039 acres and 1921 wells. The accompanying table givesspecific locations of the areas under consideration, number of leases, rangedepth of wells, average age of production, sand depths and oil production data.The results of this investigation are set forth in the accompanying charts, showing volumes of casinghead gas in 6-month periods from Jan. 1, 1918, to June30, 1921, when full record was available, production of casinghead gasoline, average productivity of the gas in gallons per thousand cubic feet, averageprice of the gas and the market price of the casinghead gasoline. The casesenumerated in the table and the data shown in the graphs do not represent thegreater part of oil or casinghead gas production from anyone township, nor arethe leases contiguous. The properties in each township, however, may beconsidered as typical of general conditions, such as the date of completion ofwells, depth, character, and thickness of oil sand, time of pumping, presentoil production, vacuum carried on wells, and usual operating practices. It was deemed advisable to subdivide the time into 6-mo. periods, as it wasimpracticable to make the tests more frequently, furthermore 6 mo. is probablythe minimum period within which there would occur a noticeable increase in theproductivity of the gas. AIME 070–63

Valuation Factors of Casing-head Gas Industry

The utilization of casing-head gas in the manufacture of casing-headgasoline by both the absorption and the compression method is a most importantfactor in the conservation of our natural resources. Any industry connectedwith the oil business, in general, possesses particular attraction for a largenumber of people not conversant with its basic principles, for the reason thatthe large fortunes made in the production and utilization of petroleum and itsproducts have been given undue prominence. The general impression of the publicthat enormous profits are to be realized in the casing-head gas industry withminimum expenditures of both capital and effort has, in a large measure, accounted for the phenomenal expansion of the industry in recent years and, likewise, has resulted in many mistakes and loss of investment funds. It istrue that many installations have been very profitable, but such instances arealways the result of careful planning, experienced judgment and conservativeestimates. The inception and subsequent activity in the manufacture of casing-headgasoline, enabling the business to assume an important position in thepetroleum industry, are of comparatively recent origin, as its greatest growth, particularly in Oklahoma, occurred during the years 1917 and 1918. Muchinformation must yet be secured and systematized concerning the methods ofmanufacture of gasoline from high-yield casing-head gas, and a large field isstill open for the application of accumulated experience and good engineeringpractice in devising better methods of extracting gasoline from casing-head gasof the poorer grades. The absorption process is coming into general use as a most efficient system oftreating casing-head gas, and even so-called dry gas. In fact, there is adecided tendency toward the universal adoption of the absorption process asagainst compression methods. However, a general discussion of the relativemerits of these two systems is not within the scope of this article. AIME 065–35