FRONT PAGE CONTRIBUTOR
How To Spend $1,000,000 a Day
Obama and the Dem Congress have made us immune to billions and trillions. In the private sector, though, $1,000,000 a day is still a lot of money.
Today’s Houston Chronicle has a pretty informative article on the search for hydrocarbons in the deepwater Gulf of Mexico. Complete with video, to boot. [Which has since been disabled for embedding. I encourage you to view the video at the linked website. – ed.]
A $1 million-a-day gamble in the Gulf
Major oil companies have focused particular attention on an ancient rock bed geologists call the Lower Tertiary trend, which runs miles below the sea floor in an outer rim of the U.S. Gulf between Texas and Louisiana.
Thought to be the biggest U.S. oil discovery in generations, Lower Tertiary fields are expected to help offset declines in shallow water fields and lift overall output of the Gulf of Mexico, which today accounts for about a quarter of U.S. oil production.
But the region also presents huge technical and cost challenges.
Not only are fields often found in waters 2 miles deep, but oil and gas deposits, buried under [thick] salt layers, are hard to detect in geologic surveys. Also, extreme temperatures and pressures in reservoirs test equipment. …
…[T]he odds of coming up empty remain frighteningly high, as do the consequences: Each dry hole is estimated to cost at least $100 million.
A couple of things to point out: many of the drilling contractors (rig owners) have chosen to domicile their businesses overseas for tax purposes. In this case, the contractor is Transocean, Ltd., formerly of Houston but now of Zug, Switzerland.
Also, one amazing aspect of the technology is dynamic positioning, which allows the drillship to maintain station even in heavy seas. Large computer-controlled thrusters on the vessel automatically maintain the vessel’s position in X-Y over a fixed spot on the mudline. Another system compensates for the heave of the vessel (Z) so that the vertical motion due to wave action does not impart vertical motion onto the drill string.