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Crude Oil and Natural Gas More than just fuel

When we think of oil and natural gas, we tend to think of fuels: in winter, for example, when our heating systems keep us warm and cozy. Or we think of filling up our cars at the gas station. Oil and gas supply the world with energy. And natural gas in particular, the most climate-friendly fossil fuel, is an irreplaceable energy resource as we scale up our use of renewable energies: for energy from natural gas can be used flexibly and ensures our supply security for decades to come. Oil is also more than just an important fuel; it is also an essential raw material for the chemicals industry and found in numerous articles we use in every-day life, for example medicines, clothes and electronic devices such as cell phones and computers. Modern life as we know it today has been made possible by oil and gas – and they will remain vital natural resources in future, too.

 

Where do natural gas and crude oil come from?

Crude oil and natural gas formed millions of years ago from organic material when materials such as dead micro-organisms, plankton and algae were sedimented at the bottom of ancient seas where there was no oxygen. One such sea is what we now call the Black Sea. In this environment, where there was no oxygen, but high pressure and high temperatures, oil and gas formed. Our film further down explains exactly how this conversion happens and explains why crude oil is sometimes formed, and why it’s sometimes natural gas.

 

The top 5 oil and gas myths

Crude oil is always pure black: that’s why we call it “black gold”. But is this really the truth? We look at some of the most common myths of the oil and gas industry and tell you: What is true and what is wrong!

 

Myth no. 1

Oil and gas are found in large hollow spaces underground such as oil lakes or gas bubbles, which simply have to be tapped into with a well to recover the natural resources.

In reality

The best way to imagine oil and gas reservoirs is to think of them as a glass full of marbles: when the glass is full to the brim, no other marbles fit in the glass because the marbles cannot be pressed closer together. And yet, there is space between the marbles - space where you could pour in water, for example. It’s similar with the layers of rock where we find oil and gas. These two mineral resources formed millions of years ago in layers of rock deep underground. The layers of rock do not consist of a block of impermeable rock; they contain small pores which are all connected to each other. Over time the oil and gas migrate through the spaces between the rocks towards the surface – and they keep going until they meet an impermeable layer. There, they gather in the pores of the rock thus forming a reservoir.

More about our oil & gas value chain.

 

Myth no. 2

Crude oil is pure black – after all, it’s also known as “black gold”.

In reality

Crude oil actually comes in various different colors: from honey yellow to hazel brown to green black and pure black. The color tone of the oil comes from the resins and asphalts, which, in contrast to the other hydrocarbons, have a dark color. The color of the oil depends on the composition of its different elements. Generally speaking, the heavier the oil the more processing is necessary before the oil can be used for other purposes. That’s why the light oils are particularly sought-after and much more valuable. But there is no relation between color and value. So instead of saying “black gold”, we should actually be saying “multi-colored gold”.

 

Myth no. 3

If you drill a hole in an oil field, the oil gushes out like a fountain.

In reality

The image of a derrick with oil gushing out of it dates back to the early days of oil production. Today’s drilling methods and safety precautions prevent the oil from gushing out like this. Indeed, an eruption of this kind would be a serious problem, and should be prevented at all times.

The cause of a blowout – i.e., an uncontrolled discharge of oil or gas – is the high pressure present in a reservoir. When oil production began in the 19th century, it was not possible at the time to control this pressure sufficiently: the oil flowed towards the borehole unimpeded, the high pressure forced it to the surface and then out of the drill pipe like a fountain – until the pressure subsided and pumps were necessary to produce it. At the time real oil lakes emerged, from which the oil was siphoned during production.

Since the 1920’s it has been possible to control the pressure and avoid such blowouts. For one thing, the drilling fluid used in the well provides counter-pressure to the reservoir pressure through the heavy weight of the fluid and forces the oil and gas back. And if despite this the pressure in the borehole were to become too great, the so-called “blowout preventer” (BOP), would prevent an uncontrolled discharge. The BOP is a large safety valve weighing up to one hundred tons that closes when the counter-pressure from the drilling fluid is no longer sufficient and the oil is pushing its way upwards. When the well is completed, the derrick is removed and production begins.

You can find out how a well is drilled and all the elements that have to be in place on our page about drilling.

 

Myth no. 4

Oil and gas reservoirs are located just below the earth’s surface.

In reality

There is an element of truth to this, but it’s not quite right. In the initial phases of oil production, reservoirs less than a hundred meters under the surface were developed, and in some cases the oil was even produced right at the surface. Oil from oil sands, for example, is still recovered in open-cast mining. However, most reservoirs, and especially the largest reservoirs that we produce from today, are located several hundreds or thousands of meters underground. That being said, the depth of reservoirs is also limited since from a certain depth the pressure and the temperature are too high for oil and gas to form.

 

Myth no. 5

Whenever a well is drilled, it produces oil or gas.

In reality

Not all wells are production wells. Once geological surveys and geophysical measurements have indicated the presence of an oil or gas reservoir, this presumption must first be confirmed. To do so, a so-called “exploration well” or “scout well” is drilled. If this well confirms the discovery, information about the size and play of the reservoir is gathered with appraisal wells. Then, when the geologists know what the volume of the reservoir is, a field development plan is drawn up and the first production well is drilled. The old exploration and appraisal wells are generally not suitable for production: they are usually almost entirely vertical while the wells that give the optimal development of a reservoir are generally drilled horizontally.

Additional information on this subject is available on our page about drilling.

Natural gas is used primarily for heating and for generating electricity – and because of its low CO2 emissions compared to other fossil fuels, this is a growing trend.

Natural Gas

Oil, gas and gas condensate are among the most important energy sources in the world. One thing we know for sure is that we need oil - currently around 90 million barrels of crude oil a day.

Crude Oil

Some oils are light, can be used almost immediately and are therefore very valuable. Other oils are heavy and have to undergo additional refining processes before they can be used.

Condensate