At last fall’s Oil and Money conference, the EIG advisory board discussed BP’s just announced service contract. It was the opinion of both Sadad al-Husseini and Issham Chalabi, former Iraq Oil Minister, that the likelihood of these companies ramping up these oil targets is remote at best and if they happen, it will be like Cantarell, doomed for over production and subsequent rapid collapse. A big problem never addressed is the lack of quality water from the shrinking Iraq rivers to due water injection for creating artificial reservoir pressure.The other points I'll respond to at some future time, but the water issue I hadn't thought about at all, and seemed quite interesting and important. Matt is alluding to the fact that it's common practice to inject water into oilfields to help drive the oil through the rock to the producing wells, and this water has to come from somewhere.
Hope this helps shed some truth into these great hypes.
So this morning I'd like to present a few back-of-the-envelope calculations of how much water might be involved. First, it's helpful to have a picture of the geography in question. Therefore, here's a map which I'm borrowing from the Library at the University of Texas. It shows the major oilfields in question, as well as the Tigris and Euphrates, Iraq's major rivers, and the access to the Persian Gulf. You can click for a larger version. It's worth noting in passing how many oilfields were not in the table of contracts yesterday.
As you can see, the Southern fields are fairly close to both rivers, as well as the Persian gulf, but water to be injected into the northern fields would most conveniently come from the Tigris.
Now, the amount of water required by an oilfield is highly variable, and we don't, to my knowledge, presently have any estimates of water likely to be required in these specific fields. In general, if there's already some natural aquifer drive that just needs to be supplemented, we might need less volume of water than the oil that needs to be produced. On the other hand, if some of the injected water will leak away into surrounding aquifers, we may need to inject more water than oil that will be produced. For a couple of examples from Saudi fields where the numbers are known, in a further email Matt mentioned:
Ghawar injects 7.1 mmb/d of Arabian Gulf seawater to go along with a re-injected water cut of another roughly 10 million b/d of water cut. Khurais, which needs to inject seawater to create an artificial aquifer, similar to what apparently would be needed to create high oil from the non-producing fields, is going to inject around 4.5 to 5 million b/d of seawater to hopefully squeeze 1,2 mmb/d of oil from Khurais.So if Ghawar production was 5mbd at the time these figures were current, the ratio of outside water to oil was about 1.4:1 in the Ghawar case, and 4:1 in the Khurais case (I'm not counting reinjected water-cut as that could be done in Iraq too). It's worth noting that seawater can be used for this purpose, though of course it needs to be piped and treated first.
So to produce 12 million barrels/day of oil in Iraq might require of the order of magnitude 10-50 million barrels/day of water, depending on specifics about the fields that we don't have at this point. Is that a lot, or a little?
Well, let's compare it to the flow in the Euphrates and the Tigris. Life here is complicated. Both rivers have their headwaters in Turkey, and the Turks have been building dams up there, diverting water, and generally getting a firm grip around the lifeblood of Iraq. This UPI piece summarizes:
But Iraq, wracked by a decadelong drought and a rundown agricultural sector, still faces a chronic shortage of water because Turkey controls the headwaters of the Euphrates and the Tigris rivers, which rise in the Anatolian Plateau.At the last known value, as of the fall of 2009, the Turks were allowing 570 m3/second down the Euphrates. Doing a little hasty unit conversion, 1 m3/s corresponds to 534 thousand barrels/day, so the Euphrates flow was 310mbd of water.
These mighty rivers gave Iraq its ancient name, Mesopotamia, "the land between the rivers," and for millennia the land was part of what was known as the "Fertile Crescent."
The rivers remain Iraq's primary source of water. But the flow has been dramatically cut in recent years as Turkey forged ahead with its ambitious Southeast Anatolia Project. This involves building 22 dams and huge reservoirs, with 19 hydroelectric power plants, along the fabled rivers in nine of Turkey's poorest provinces.
The $32 billion project, known by its Turkish acronym GAP, is the centerpiece of Turkey's development plans. It was started in the 1980s and is scheduled for completion in 2013. It will generate 1,200 megawatts of electricity and irrigate thousands of acres of land for crops.
All this leaves Iraq at the mercy of its northern neighbor. The Euphrates and Tigris waters are critical for at least half of Iraq's annual grain production and most of its drinking water.
According to the Wikipedia the average flow of the Tigris is 666 m3/s, which corresponds to about 360mbd.
So injection water for all oil production in Iraq would require something like 2-8% of the average flows of both rivers. However, a number of factors complicate this very simplistic back-of-the-envelope analysis:
- Water from the Persian Gulf could be treated and used for the southern fields
- Iraq is already under water strain, and thus any allocations from the rivers will be charged political issues.
- Iraq could negotiate with Turkey for more water. The US might be willing to apply pressure. Oil revenues might be used to essentially buy more water.
- Maintaining a constant take from the rivers at the dryest part of the year might be particularly difficult.