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Energy Independence: The Secret Weapon of Seismic Data

To tap unconventional reserves, E&P players need companies like CGG-VERITAS

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At this point in InvestorPlace’s series on Energy Independence, it’s no secret that global energy demand is rising at exponential rates. Overall, the Energy Information Administration’s (EIA) latest global forecast predicts that the world’s energy use will jump nearly 53% by 2035 as strong demand from emerging markets such as India and China continues to rise.

The EIA also believes that fossil fuels will still be the dominant means of powering our planet in 2035, with oil and natural gas representing the bulk of the world’s projected energy supply.

And with traditional reserves quickly dwindling, energy & production (E&P) companies have literally gone to the ends of the earth to find new ways to meet that demand. These unconventional sources are becoming the norm when it comes to production and reserves. Tools such as hydraulic fracturing and horizontal deep-sea drilling rigs are now standard equipment, and regions such as Africa’s fertile oceans and America’s shale formations are dotted with activity.

These sorts of unconventional assets require big bucks to fund and are one of major reasons behind the exorbitant CAPEX budgets we have been seeing from the oil majors of late. All this drilling and demand ultimately will benefit the broad oil-services sector.

Oil Services: A Vital Link In The Chain

With energy prices and demand continuing to rise, finding new sources of supply continues to be a paramount goal. While much attention is focused on E&P companies, the real grunt work falls to the oil-services sector to get that oil out of the ground. From drilling rigs to pump trucks, it takes a lot of moving parts to support a drilling operation. That’s why the oil-services sector continues to be one of my favorite ways to play rising energy demand.

How does an energy company know precisely what ‘end of the earth’ to drill in? These days, that task falls to various seismic-data companies with specialized technological know-how — affectionately known as “doodlebuggers.”

Drilling companies have been using seismic data since the 1920s to identify various geological conditions that are favorable for oil and natural gas and to evaluate their various drilling potentials. However, like much of the energy sector, advances in technology have allowed the sector to expand its offerings. The use of advanced 3D seismic-data equipment has been crucial to the discovery and development of many deepwater fields, including those off the coast of Brazil, as well as in the discovery of pockets of  natural gas in shale formations.

Likewise, new developments in 4D, or time-lapse seismic monitoring, has enabled E&P companies to better observe fluid movement and differentiate between the drained and undrained portions of a reservoir. Both 3D and 4D gear have become critical to finding new energy deposits.

At its core, seismic equipment works by sending an acoustic wave beneath the earth’s surface. That wave bounces off underlying rock layers and then is enhanced by sophisticated computer software to produce a 3D image of subsurface layers that can be used to map exploration projects. These images help exploration companies accurately and cost-effectively evaluate a promising field for its oil-and-gas-yielding potential.

Article printed from InvestorPlace Media,

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