Background

In the United States alone, more than 2 million wells have been drilled in the search for oil and gas since the first few successful wells in the mid 1800s. Of these wells (averaging about 1000 meters in depth but ranging to as much as 8000 meters), only about 1 exploratory well in 10 has found oil in sufficient quantities to justify production; and 1 in 50 has found enough oil to repay its total costs. Of course, this is not to say that the oil business has not been profitable, but only that one must do a lot of exploratory drilling before any profit is seen. Today, oil and gas have emerged as critical natural resources to the world?s economy. Given this, it can be easily surmised that the complexity, expense, and the environmental impact of exploratory drilling will continue to escalate as the depletion of once-productive deposits will force new searches for oil and gas into more remote and hostile environments. 

The presence of oil and gas can only be confirmed, generally speaking, by actual drilling. This is what makes exploration an expensive enterprise, since there is a significant likelihood that preparation, equipment, and operation costs related to drilling may not be offset by profits reaped by actual oil and gas discovery. The difficulty of finding oil and gas can be attributed primarily to the fact that deposits are simply not found in the form of underground lakes capped by natural gas, but, rather, are usually found in pores of rocks as a mixture of oil, salty water, and natural gas. The oil clings tightly to the pores of the rock to resist even the most elaborate schemes to wrest it out. In some cases, under the pressure associated with the depth of the earth?s crust, much of the gas and some of the oil and water naturally flow up the pathway provided by the well to the surface. How much depends on the viscosity of the oil, which varies greatly, and on the porosity of the rock in which it exists. Often, pumping is necessary to bring much oil to the surface. The brine that comes with the oil?typically about 3 barrels of brine per barrel of oil?must be disposed. 

How does ?oil and gas exploration and production? affect the environment? Exploration, development, production, product treatment, and waste management activities associated with oil and gas production projects can have a variety of impacts on the environment. They include destruction or alteration of wildlife habitats, erosion, sedimentation, pollutant loading of groundwater and surface water from product and/or waste leaks and spills, groundwater contamination from communication between production or waste injection zones and underground sources of drinking water, release of hydrocarbons and hydrogen sulfide to the atmosphere, and decreased soil productivity from land spreading and/or releases of reserve/mud pit contents.  To avoid such environmental catastrophes, oil and gas professionals have developed practices that have reduced the generation of waste, improved the economics of drilling and production operations, and led to safer operations.

Overview

The oil and gas extraction industry is an important link in the energy supply of the United States. Petroleum and natural gas supply 65 percent of the energy consumed in the United States, and domestic producers supply approximately 40 percent of the petroleum and 90 percent of the natural gas [EIA and Independent Petroleum Association of America (IPAA), 1999]. According to the 1992 Census of Mining Industries, the industry employed 345,000 people and had yearly revenues of $112 billion.

The consumption of oil and gas in the United States is closely linked to the overall economy of the country. Between 1990 and 1998, crude oil consumption increased approximately 1.4 percent each year, and natural gas consumption increased at a rate of 2.0 percent per year. The rate of natural gas consumption is expected to continue growing, mostly at the expense of coal. Natural gas is expected to become an important source of energy in the future and will be accelerated by government policies and the development of the natural gas transportation infrastructure. In the past several years, however, the percent of the domestic consumption of both oil and gas met by domestic producers generally has decreased.

Where is oil and gas produced? The major oil and gas producing areas in the United States are in the Gulf of Mexico region (onshore and offshore), California, and Alaska. The Gulf of Mexico and surrounding land in particular is the most concentrated area of production; in 1998, Texas (onshore and offshore) produced 23 percent of the nation?s crude oil, Louisiana produced 5 percent, and the Federal offshore region produced 14 percent. The geographic distribution is similar for natural gas; Texas, Louisiana, and the Gulf of Mexico are the major producing locations. New Mexico, Oklahoma, Wyoming, and Kansas are also important gas-producing states, while California and Alaska are less important with respect to natural gas production than they are for crude oil.

Why has this hub been created? The purpose of this hub is to assist oil and gas professionals (and others) with waste reduction, waste management, and pollution prevention information in exploration and production activities. The ever increasing reliance the United States has on oil and gas resources will consequently lead to an increase in oil and gas exploration and production.  Possibly, an increase in oil and gas production can lead to adverse effects on the environment, if the proper steps are not taken. This is why the information contained in this hub promotes the belief that best management practices combined with the implementation of pollution prevention alternatives (or techniques) is the best way for an oil and gas entity to remain competitive, have safer operations, lower its liability risks, and increase its savings.

Standard Industrial Codes (SIC)

North American Industrial Classification System (NAICS)

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