The oil and natural gas that power our homes, transportation and businesses are found in small spaces (called “pores”) between layers of rock deep within the Earth. Many offshore wells, for example, are drilled in thousands of feet of water and penetrate tens of thousands of feet into the sediments below the sea floor.
Natural gas is usually found near petroleum. Oil is then transported to refineries and distilled into fuel or base chemical products. Natural gas is pumped from below ground and travels in pipelines. Natural gas is difficult to transport across long distances. In most countries, natural gas is consumed within the country or exported to a neighboring country by pipeline. Technology for liquefying natural gas so that it can be transported in tankers (like oil) is improving, but the volume of natural gas exported in this manner is still limited. As technology expands the options for gas transportation, demand for natural gas is expected to grow.
More than 100 countries produce petroleum. Most of those countries produce both oil and natural gas; a few produce only natural gas.
Many factors can affect oil production, such as civil unrest, national or international politics, adherence to quotas, oil prices, oil demand, new discoveries, and technology development or application.
The larger subsurface traps are the easiest deposits of oil and gas to locate. In mature production areas of the world, most of these large deposits of oil and gas have already been found, and many have been producing since the 1960s and 1970s. The oil and gas industry has developed new technology to better identify and access oil and gas:
Improved seismic techniques (such as 3D seismic) have increased the odds of correctly identifying the location of smaller and more difficult to find reservoirs.
New drilling techniques can intersect a long, thin reservoir horizontally first that then turns vertically making an “L” shape. This enables the oil or gas from the reservoir to be recovered with fewer wells.
World oil production comes from more than 800,000 oil wells. More than 500,000 of these wells are in the United States, which has some of the most mature producing basins in the world. On average, an oil well in the US produces only 10 B/D, compared with 248 B/D in Russia, 3,077 B/D in Norway, and 5,762 B/D for a well in Saudi Arabia. Comparable data for natural gas wells are not readily available.
There are still many oil and gas reserves left to be discovered and produced. Future discoveries will be in deeper basins and in more remote areas of the earth. Advanced technologies also can be used to locate small reservoirs found in existing oil and gas areas.
Where is oil found?
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