Petroleum Production and Movement

PETROLEUM PRODUCTION AND MOVEMENT100 YEAR'S DEVELOPMENT

By H. JAGGER, Esq., B.Sc., F.lnst.P., Esso Petroleum Co. Ltd.

Early Petroleum Production The Old Testament and other early WM'Uil";<; contain reference to' pitch and 'fiery flames' which could well have been natural gas seepages ignited by lightning. It was not until 1859 that a 'Colonel' Drake decided to drill for crude petroleum oil at Titusville in Pennsylvania, U.S.A., to supplement the material available from surface seepages and shallow excavations. At that time mainly the kerosine or paraffin fraction was utilized as illuminating oil and both the lighter and heavier components were discarded. The development of the internal combustion engine around the turn of the century and the impetus given to its use and to the burning of oil in ships by the war of 1914-1918 saw a changed situation in which the kerosine fraction became less important than the motor spirit (or petrol) and the heavier diesel oils and residual fuels. Some heavy residues were also in demand for road making, to facilitate movement by the new motor cars and to supplement the asphalt from depO'sits such as those in Trinidad.

The Contribution of on to World Energy As a youthful competitor with coal, oil in 1900 supplied approximately 5 per cent of the total world energy consumption of some 780 million metric 'tons coal equivalent. By 1938 oil provided 20 per cent of a tO'tal world energy demand of 1,770 million tons and natural gas provided a further 5 per cent.

The SecO'nd WO'rld War and the immediate post-war period resulted in even mO're rapid expansion of world petrO'leum cO'nsumptiO'n. CO'nsumption continued to dO'uble each decade and by 1960 O'il provided 34 per cent O'f tO'tal world energy and natural gas a further 14 per cent. AlthO'ugh final figures are nO't yet available, by 1968, oil prO'vided O'ver 50 per cent O'f the wO'rld energy demand.

World Petroleum Production WO'rld prO'ductiO'n of petrO'leum - including liquids recO'vered frO'm natural gases - rO'se frO'm 280 milliO'n metric tO'ns in 1938 to' 538 milliO'n metric tO'ns in 1950 1090 milliO'n metric tO'ns in 1960 and 2,130 milliO'n in 1969. . With such rapidly increasing prO'ductiO'n rates, hO'W IO'ng Will the knO'wn reserves meet O'ur requirements. Reserves in 1947 were. 9,500 milliO'n metric tO'ns, equal to' sO'me 25 years at that time. In 1968 prO'ven reserves were 63,000 mlllIon metric tons or over 30 times the annual requirements at the 1968 consumption level. The industry has continued to explore and has met with sufficient success in its exploration to ensure that known reserves continue to represent many years foreseen requirements. Changing Pattern of ConsumptiO'n and Manufacture America and Russia were the earliest cO'untries to develop significant prO'duction O'f petrO'leum and were alsO' the leaders in its cO'nsumptiO'n prior to' the First World War.

In 1950, the V.S.A. cO'nsumed 60 per cent of WO'rld total consumptiO'n and Western EurO'pean consumptiO'n exceeded the SO'viet blO'C cO'nsumptiO'n. By 1960 Western EurO'pean consumption was three times the 1950 figure and a similar expansion had taken place in the Far East (including Australasia). By 1968, with further rapid expansiO'n in these areas, North American consumptiO'n accounted for only 37 per cent of wO'rld total consumption, Western EurO'pe had risen to' 26 per cent and Far East cO'nsumption was apprO'aching the SO'viet blO'C figure of 15 per cent of the world to' tal.

Need for Increased Oil Transportation Thus, while Western European petroleum consumption increased by 1968 to' 25 per cent O'f the wO'rld tO'tal and refinery capacity had been increased to meet these requirements, productiO'n in the area was only 1 per cent of the world tO'tal. The Middle East and Africa in the same year produced 38 per cent O'f total world production but consumed only 4 per cent of the WO'rld tO'tal. Massive movements O'f crude O'il have to' be made from the areas of high production to those of high cO'nsumption and Iow indigenO'us prO'ductiO'n and a large part of these movements affect V.K. waters. Tanker movements O'f crude oil through the English Channel currently amO'unt to' 260 million tO'ns - some three times the annual V.K. consumption. In additiO'n, considerable quantities of fuel oil and other persistent oils are moved by tanker arO'und the cO'asts of the British Isles. Such oils are also extensively used as fuels fO'r dry cargo vessels so that the to' tal mO'vements which CO'uld cause pollutiO'n of the seas around the British Isles exceed 350 milliO'n tons/year and are increasing annually by about 10 per cent.

To handle these vast tonnage mO'vements of petroleum, tankers have grown in size as well as in number. World tanker tonnage increased from 17 million dwt tons in 1939 to' 117 million dwt in 1968 .

Product Movements Refining O'peratiO'ns invO'lve the stO'rage of significant quantities O'f crude O'il intermediate products and finished products. Only the finished products leave the refinery in quantity, so that it is with these that we are mainly concerned.

Normally, the distributiO'n from domestic refineries is to majO'r marketing terminals and from these to smaller depots