New technology brings increased oil and gas activity to Mississippi

by

Published: July 23,2007

Rising energy costs and issues surrounding a stable energy supply are major concerns across the country. Some oil and gas industry leaders say Mississippi is positioned to play a role in meeting those energy needs. Oil and gas exploration and production is becoming increasingly important.

Jackson geologist Dudley Hughes says there are not a lot of new places for exploration in the state but there are new ways of producing more oil and gas by using new technology.

“The most significant thing going on in the state right now is the operations of Denbury Resources to recover more oil out of existing fields,” he said.

Using recent advancements in the tertiary recovery of domestic oil in proven fields in Mississippi, the Texas-based company last year completed a $50-million, 84-mile carbon dioxide pipeline across the state and has announced plans to invest nearly $1 billion in the state over the next 20 years.

“There are now plans to pump all the old wells in Mississippi,” Hughes said. “They used to be worthless but now can be used. By pumping carbon dioxide into the wells, the old fields will produce 25% to 30% of the state’s production.”

Hughes, who’s been in the business since 1953, said primary production comes out of the wells naturally, but the secondary production comes by pumping the carbon dioxide into them with the chemical acting as an Alka Seltzer for the wells.

“This technique will be useful mainly in the big old fields, mostly in South Mississippi — Little Creek, McComb, Heidelberg, Soso and Rankin County,” he said.

Additionally, new seismograph techniques now pick up a lot of things formerly passed up in smaller oil and gas fields. A third factor in current activity is locating the Floyd Shale in North Mississippi and Alabama. Hughes said the formation is similar to the huge Barnett Shale in the Fort Worth, Texas, area — the most significant natural gas find in recent years.

“There are some puny wells being drilled but now days that’s needed,” he said, “and there’s some ultra-deep drilling going on. Oil and gas in chalk was never commercial because it’s hard to get out. Now there’s some horizontal drilling going on too. Some techniques were not commercial in the old days, but they are now.”

‘A lot of activity’

Joe Sims, president of the U.S. Oil and Gas Association in Mississippi and Alabama, agreed with the importance of increased use of new industry technology in the state.

“We’re seeing a lot of activity that’s not new wells but is enhancing recovery of existing wells,” he said. “It’s affecting Pike, Lincoln, Jones, Rankin, Wayne and Jasper counties.”

Sims said 80% to 90% of wells drilled in Mississippi are gas, and there are some major gas wells being drilled now.

“If they are successful, that suggests we’ll have a lot of activity,” he said. “Mississippi has a bright future in deep natural gas and a lot of places have potential for a large share of wells. A few of those are Wayne, Marion and Hinds counties.”

An independent streak, too

Mary Ellen Jones is keeping Morrow Oil Company going. Her late father, Bill Morrow, was a geologist and founded the Jackson company where she’s worked for 25 years. She said independents like Morrow Oil are a dying breed, but she’s encouraged by current activity.

“Higher prices for natural gas and oil have spurred exploration. It all goes hand in hand,” she said. “It makes it possible to go out to explore for new wells and to re-open some of the older wells. Oil and gas exploration are definitely good economically for the state.”

Jones said Morrow Oil is staying with the existing wells it has in Wilkinson, Adams and Pontotoc counties in Mississippi and some in North Alabama.

Contact MBJ contributing writer Lynn Lofton at llofton656@aol.com.

[RSS Feed] [del.icio.us]



To sign up for Mississippi Business Daily Updates, click here.

POST A COMMENT

 

Top Posts & Pages