Whatever your profession, be sure that you have a true love for it, then pursue it...

I just wanted to begin by having you speak a little about your educational background and your career which has been long and varied and tell us what you are doing now and kind of introduce yourself to our members?

I have a BA from Pomona College in Claremont California. It is a small liberal arts college. Although I majored in Geology, I studied a great number of other topics, primarily history. My MS in Geology was from the University of Colorado in 1980, and my PhD in Geology was from the University of Texas in 1989.

I worked between 1980 and 1984 with Sohio Petroleum in San Francisco, and then I took educational leave from 1984 to 1988. In the mean time, Sohio was purchased by BP. When I was finished my PhD in 1988, I had to make a decision; that is when I quit BP and went to work with Mobil where I worked for 2 years in Dallas, both as a research and exploration geologist. I began teaching at the University of Colorado in August 1990.

I notice in your brief bio being circulated with the DISC introduction, that you started your career as an exploration geoscientist with Sohio Petroleum in 1980. You have not mentioned it as a geophysicist or geologist. Also, your published work suggests a lean more towards geology. I would like your comment on that.

By training, I am originally a geologist. Coming out of my Masters, I had focused on stratigraphy, sedimentology, and structural geology. I use the term “geoscientist” because I feel that geophysics and geology in the petroleum industry have merged during the past 18 – 20 years. I consider myself probably 2/3 geologist and 1/3 geophysicist. In the University, I teach an introductory course in geology, so I am still more comfortable with geology. These two disciplines, as defined by and used in industry, have merged, so I prefer to use the term “geoscientist.” I do not feel like getting into an argument about semantics on this issue…

It’s still not very common. People still stick with their own designation. You know, I am a geophysicist, I am a geologist.

Well, it depends upon different countries and companies. Clearly people still use this distinction as a means of separation for salaries. Let’s face it, engineers are at the crest of the pay scale, geologists are still the bottom feeders, and geophysicists are in-between (laughing).

Were you interested in science as a child at school?

Yes, to a certain degree, but I was not a science geek. I think the closest thing to describing me is the term “natural historian.” This was a common term up until maybe World War II— paleontologists stratigraphers, and sedimentologists were called “natural historians” and I think that comes closest to what I am. The disciplines that constitute natural history would be aspects of geology, paleontology, history, biology.

You are a Professor at the University of Colorado. What do you enjoy most about teaching?

Simply, the interaction with people. I think that is ultimately why anyone becomes a teacher, because you are connected with people and interacting on a deep, meaningful level. If you are fortunate to work with a good student, ultimately they teach you far more than what you can ever teach them.

What do you consider your most important contribution to your profession?

I have supervised and graduated 37 graduate students, and interacted and collaborated with 14 research scientists and 10 visiting scientists. That’s my biggest contribution. The second one is that I have published papers with 85 different authors, meaning that I have collaborated with a lot of people.

Great: So it’s the human element?

It always is. That is the accomplishment that I derive the greatest meaning.

Good. That is a very valid reason. You have written one book, co-edited 8 books, and are in the process of writing some more. What is your perception about writing? Is it sharing of information, experience, knowledge, invaluable insight or something else?

For me, writing is the most difficult intellectual task. In the introduction of the DISC book, I included a little quote that I ran across once…

Yah, I think I saw that –

“ Writing a book is easy, just go sit at the typewriter and open up a vein.” That cogently summarizes the process of writing. Writing a book is far more difficult than editing a book, and editing a book is far more difficult than writing a paper. So the difficulty in writing is a graduated task. I have friends who are professional writers, either journalists or technical writers. The fact that they can sit down and write something quickly and write it well impresses me. I cannot do that— I do not have that gift. Scientific writing is about sharing information that needs to be said in a more permanent way than the spoken word. What always continues to astound me on this DISC tour is when I show up in a country, such as India or China, and some one has read something I have written. They say “you know I have really enjoyed that but I do not agree with this point or I used it this way and it really helped me, etc.” Petroleum geosciences is a science that is done largely by analog; if I have observed something in one area that may help some one in another place in the world, then writing about it can be a worthwhile contribution.

During the past decade, the deepwater GOM has moved from an exploration frontier to one of the most productive sources of oil and gas production in the world. Reasons- deepwater GOM is characterized by multiple productive horizons and high production rates, which greatly reduces risk and improves economics. Technology to drill and develop deepwater discoveries is rapidly progressing and is becoming more cost effective. Also, the close proximity to infrastructure and continental US markets, allows oil and gas discoveries to be quickly brought onstream. Can we say that for other deep water areas in the world?

In certain areas, yes. Other deepwater areas are not that advanced yet. Development of the production infrastructure is the most critical long-term issue in making an area economic. In the northern GOM, a development infrastructure already existed on the shelf before exploration moved into deep water. It still took enormous capital investment to move development into deepwater, and it happened in a stepped, slow fashion, and it’s still going on. Large portions of the northern deep GOM are still immature areas— there is still a lot of technology that has to be developed before they can be developed—

Yes, but is that true for other areas?

Well, remember the slide I showed you yesterday—

I know because before you showed the slide yesterday, I was under the impression that Angola, Nigeria, Brazil and the Gulf of Mexico, these are the 4, but you also showed two other areas offshore, what was that, Borneo and Australia. So these are other two areas—

Well there are a few others, let me just walk through them– Brazil now has an infrastructure in portions of their deep water (portions of the Campos basin) but it took many years to develop. There have been some recent discoveries in other basins, notably the Santos and Espirito Santos, and a production infrastructure will have to be developed. A good infrastructure has been developed for portions of Angola as they started to put their big discoveries on line in late 2001 and early 2002. More infrastructure will be needed in other areas. In deepwater Nigeria, they are just starting to bring fields online now; I believe Bonga is supposed to be the first one in 2005. A good production infrastructure exists on the shelf, and the Deep Water infrastructure is evolving. In the deepwater Nile offshore Egypt, two of the initial deepwater gas fields were brought online by subsea tieback in late 2003. This addressed their domestic needs. Beginning in 2005, several more gas fields will be produced by subsea tieback for LNG trains. This will then be exported.

Several companies have made a lot of discoveries offshore of the Mahakam Delta in the Kutei Bay in southeast Borneo. The operators are moving towards putting an infrastructure together. Again, a good development infrastructure exists in shallow water on the shelf there, but moving into deep water is a pretty big capital investment. In northwest Borneo, companies are moving to develop the recent discoveries offshore Sarawak in Malaysia. There have been several recent discoveries in the Krishna Godivari Basin, offshore eastern India, with no significant infrastructure in place yet. In offshore Mauritania, several discoveries have been made, and the operators plan to use FPSOs initially for development beginning in 2006 or 2007. A recent discovery offshore has been made at the Sakhalin Islands in eastern Asia. In summary, the answer is obviously complex. It depends on the basin and how mature it is.

If I say that within the oil and gas industry, deep water is an area in a state of transition, from exploration-led stake building to development-led delivery of value, will you agree with me?

The answer is on a basin-by-basin consideration. The initial discoveries are going to development-led delivery value but still, there is a lot of drilling that can be done in just about every deep-water basin where they have discoveries.

This may be valid for Northern Gulf, isn’t it?

Yes, well, in certain areas of the Northern Gulf, they are going to be bringing on-line several big fields during the next 1-2 years. However, there have been several discoveries in northwestern Deep Gulf that companies are still working on how to develop them in the best way; so, it’s still largely in exploration mode into early development. It really depends on each basin. I would say that in certain portions in certain basins, your statement is true, but in most basins we are still more in exploration mode and early development mode.

How much of the US oil and gas production comes from the GOM?

In 2003, the Gulf of Mexico produced about 35% of the total US oil. The hurricanes of late 2004 caused significant production delays, so this percentage dropped.

Usually, we talk of the big four countries when it comes to deepwater exploration. Could you name them for our members and tell us something about each? So are we talking about oil and gas or both?

For different countries, some are more oil prone, and some are more gas prone. Egypt is more gas prone. So far, they have one discovery in deep-water off Norway gas. Northwest shelf of Australia is more gas-prone. Brunei is the largely gas, with some condensate. Some of deep-water Nigeria is gas. Other areas are more dominant in oil such as Angola, Brazil, on the Northern deep Gulf. So it depends on the basin.

So if it is largely gas, then it is not going to prove so economical...?

It depends on the infrastructure. Again, gas in the U.S. is actually cheaper to produce gas than oil in some areas. So it’s good there, but places like, you know—

Egypt, for example…

I think the development of their gas is going to help them quite a lot. In offshore Egypt, gas development began in late 2003 from two fields by subsea tiebacks. My understanding is that this is really going to help address their some of their domestic energy needs. More subsea tiebacks will occur this year (2005) for LNG trains for export. The Northwest Shelf of Australia, has about 75 – 80 TCF that has been discovered but are stranded. Some initial LNG contracts have been signed this past year to start to develop this gas. Most of the gas is in Jurassic-Cretaceous fluvial-deltaic reservoirs; the rest are in deepwater reservoirs. So it looks like they are finally going to start development. I think the driver is primarily the tremendous expansion in Chinese economy. I saw a figure the other day that energy imports have increased 38% in the last year for China. Thirty-eight percent in a country of 1.3 billion people is a lot. So it depends, but there is a lot of stranded gas and that’s a real challenge to develop.

What depths are we talking about, when we talk about ultra deep water? You mentioned the ultra deep water, more than 2000 m ...?

That’s an arbitrary definition. For the DISC book, we refer to deep water as water depths from 500 to 2000 m, and ultra-deep water is any water deeper than 2000 m. Greater than 500 m is the depth where standard jack-up rigs can no longer be used for drilling. The 2000 m definition for ultra deepwater is somewhat arbitrary—that is the depth that Henry Pettingill and have used in the DISC book.

Which are the oil companies active in their deep water exploration capabilities? Could you name them in any particular order, be it capability wise or something else?

I will give you a lot of names, but I am afraid I may omit some. I don’t want to get into any trouble here (laughing). In no particular order, I would say Royal Dutch/Shell, BP, ExxonMobil, ChevronTexaco, Total, Petrobras, Statoil, NorskHydro, Total, British Gas, ConocoPhillips, BHP-Billton, Woodside, Anadarko, Unocal, Hardman, Reliant, Murphy, Encana, Nexen, Ocean/Devon, KerrMcGee, Murphy, YPFRepsol, Vanco, Petronas. There are easily 35 – 40 companies in more mature areas like the Northern Gulf including the independents. I am confident that I just omitted several companies, so here is my mea culpa in advance (laughing)!

What is the maximum water depth in which we can drill as on today?

The answer depends upon the purpose of the drilling. The scientific drilling programs, such as the present International Ocean Drilling Program (IOPD), and its predecessors ODP and DSDP, use riserless drilling. This means they are merely extending drill pipe into the water column. The record water depth is Site 461A of the DSDP Leg 60 program, which was drilled in the Marianas Trench in the early 1980’s in 7044 m of water. Riserless drilling allows for operations in water depths far greater than those that will ever be drilled by the petroleum industry. In contrast, for industry operations, drilling platforms (rigs) must use a marine riser to connect a closed circulation system back to rig drill floor. This is needed to control the pressures of industry wells that are drilled substantial deeper below the seafloor than in scientific ocean drilling. Current risers in use today are quite heavy, so there a practical limit to the maximum water depth for industry drilling, which is presently considered to be around 10,000 feet. To date, the deepest water in which an industry well has been drilled is 10,011 ft. Chevron- Texaco and partners drilled this well in November 2003 on Alaminos Canyon Block 951 in the northwestern deep Gulf of Mexico, into a geologic feature called the Perdido Foldbelt. My understanding is that there is considerable research being done to develop dual gradient and surface blowout preventer systems, which will attempt to eliminate the use of traditional risers linked back to the rig on the sea surface. When this is accomplished, water depths will increase for industry drilling operations.

Deepwater wells are a major investment, $20 M to $50 M each. Just the ability to drill deep water wells is not enough. What else is required that will make the difference between profit and loss?

I would actually make it $20 – 100 million. Well, pretty much everything I have discussed in the course. The first goal is to avoid the many potential drilling problems: shallow hazards, overpressures, drilling hazards are a problem, is that what you mean in terms of just the ability to—

Yah, that could be one of them but what I was wondering is ….

Business practices?

Yes, how much more information you need to make sure that it isn’t going to be a disaster?

Step #1 in upstream starts with good seismic imaging and developing an accurate earth model. Companies have been moving towards people working in integrated teams; this has been really been a critical factor in working effectively in deep water—the need to have drilling and development engineers, and development geoscientists working at the time of the well or shortly after the first well is drilled, it’s how quickly they can basically fast-track the development of discoveries, and that requires trying to reduce cost and speed everything up, if you get people working in teams like that and they are very forward looking then you go forward with it. That’s pretty essential. Partnering, reducing risk that way, is pretty essential. Cash management is very important.

In the 1970s and the early 1980s, geophysicists working in offshore areas relied on spotting anomalies, where not being so knowledgeable about structural geology was not so much of a problem. In other words the attitude was to pick up these anomalies without going into why they were there. And this worked e.g. in the Gulf of Mexico and other areas. Later they started using AVO to confirm such anomalies. When you talk about ‘deeper’ exploration, the rocks become denser and so the variable densities or porosities you are looking for are not there, i.e. DHI effects decrease drastically with depth. Besides, the AVO response in these areas may or may not conform to the structures present. What strategy do you adopt in such cases for detecting anomalies?

You question is quite pertinent. One of the things I emphasize in the DISC course is that to date, about 80% of the petroleum found in deepwater is associated with some sort of DHI. I also emphasize that in many basins, DHI’s do not exist for the reasons that you stated. what a lot of people are running into now in different basins, is they don’t have DHI. In some recent wells in different basins, there have been some expensive dry holes drilled, and I have been told they do not have a good understanding of the rock physics, i.e. what is the seismic signature of sandstones and shales. The issue then becomes if there are not some sort of amplitude anomalies, how can we risk the basin. And that’s what people are trying to sort out. What is the geophysical signature – you are asking a proprietary question, that I actually do not know the answer. I do know that companies are working on the geophysical response, but more importantly, in a lot of these basin, companies are trying their best to integrate all aspects of the entire petroleum systems, so that they look at the timing of the development of traps, what is the probability of charge, what is the probability that we have field, that kind of thing. All disciplines are being integrated, so it is not simply a case of using geophysics by itself.

I asked a guy from an oil company; I sent this question. He wrote me back to say we are doing work on this, but I don’t have the permission to...?

The answers are proprietary and that is what everyone is trying to study. So it does not surprise me that that would be his response. Some of the discoveries in the Northern deep Gulf do not have any proper amplitude anomalies, because they are deep in the section, the reservoirs are older and buried deeper.

Yes, this is another problem that complicates the issue; at the deeper level, the amplitude information is not so authentic as you have at the shallow levels, especially when you have a big water column. It complicates the whole thing. So this is a very tricky situation here.

Right, and my response would be every body is working on this! I do know though that as the challenging in imaging in terms of whether you have reservoir present or not, it just means you need to use a more complete, integrated approach.

In deep water field development, the seismic interpretation (based on amplitude) of the continuity of geological bodies is important for say, optimizing the position of producers and injector wells. Sometimes amplitude changes tend to get masked at the deeper levels and so the objectives are not achieved. What strategy is usually adopted in these cases or what technology is utilized to get a clearer picture and hence interpretation. Or would you say seismic doesn’t help at all?

People are routinely collecting higher frequency seismic surveys or beginning to collect repeat 3-D seismic data. Both approaches are helping to image the deeper masked levels. The integration with the other static and dynamic reservoir data sets is imperative to derive a good subsurface image. I show several examples of this in the DISC course.

What are your other interests?

I presume you mean professional.

Well, apart from professional you can tell us about...

I am currently working with a wonderful group— Ryan Crow, John Roesink, Jay Austin, Rick Couture and Jim Fox—on geologic outreach. We are trying to change the focus of our research towards a lot of outreach in geology for the public. The way in which we are attempting to do this is by creating very accurate animations of a geologic evolution of an area showing the change in landscapes through time. So we have developed these for Colorado National Monument, and for Houston Museum of Natural Sciences, now showing the Mesozoic-Cenozoic in the Gulf of Mexico. We are doing creating a 5-minute animation for the Colorado School Mines geology museum. It will illustrate the present landscape and did the landscape get there as you look out the window. We are talking with several other museums, national parks, and other groups about doing similar kinds of animations. The students in primary and secondary schools really respond to these kinds of animations. Most of my complaints with geology education at this level is watching how they try to teach primary and secondary children. Students are shown a volcanic rock and they are expected to be able to extract a volcano out of that. I think this approach is backwards, so we started creating these animations a few years ago. When we have shown the animations to many children, their eyes light up like silver dollars— their eyes are so big. It’s just a matter of finding enough funding so we can keep this thing going, but I feel like we’ve got a great idea. We are trying to get enough money set up that we can turn this into a permanent kind of project but it’s always funding related, like everything.

So, that’s the other major professional focus in my life right now. I am trying do a lot more outreach because I have been in this industry 25 years and there is something else. I do not plan to leave industry, I still enjoy it. This lecture tour has been a real shot-in-the-arm professionally, and it has been a lot of fun. Visiting so many different countries and seeing the kinds of technical issues they are addressing in their work.

Yeah, apart from your professional interests, what else do you do?

We have 2 children so I spend as much free time as I can with them. Now that the DISC tour is completed, I now have a lot more time to pursue many different interests. I have always been outdoors oriented but I have not been quite as outdoors oriented in the last year or so because of SEG tour; I ski, I hike, that kind of thing, quite extensively and I would like to get back to doing that.

You are very enthusiastic about the geosciences. What would you tell a young person considering taking up a career in geosciences. What are the most rewarding aspects?

I say four primary things.

When choosing your profession, be sure you have a true love for it, and then pursue it.

I always advise my students to approach their career such that at some point, you are going to be working as a consultant. This means one should plan accordingly in terms on how one approaches his or her work. Learn as much as you can, stay up on technology, develop good networking abilities, and continue updating your education all the time. When I started in industry in 1980, I was told that someone’s scientific half life is 8 years in terms of their knowledge. This means that every 8 years you have to re-invent yourself and I think that is probably a good rule-of-thumb. From my perspective, the biggest change in the last decade is the rapid evolution in technology, in terms of software, increased abilities to image the subsurface, and drilling. I do not think the geologic concepts have changed as rapidly as the technology. This trend is probably true for many fields outside of geology.

Be flexible. Be cognizant of the fact that the oil industry works on business cycles of 2 – 3 years; if you sit on the sidelines and watch, you can generally see them. We are in a business cycle right now that is a bit different than past cycles — relatively high, sustained prices but without the traditional increase in activity in many places. Support for academic programs is dropping. Be aware of the fact that our professional lives are run by business cycles to a certain degree. Be aware of them and learn to paddle with it.

Finally, be mindful that as you grow older, your interests are going to change, sometimes quite significantly. Be aware of that in your career.

Did you do the interview with Olivier Dubrule also? It was wonderful. That’s a great service.

It is good to communicate this to other members. We have a membership of a little over 2,000 and the members of the Leading Edge is 20,000 plus. So it’s good to talk to people and communicate.

Yes, I read the interview with Olivier and I thought “This is good.” I didn’t realize you did the interview.

You have a professional diary to write as well.

Right, I read Olivier’s diary, so I have been taking notes everywhere I have gone.

Well, Paul, thank you very much for giving us the opportunity to come and talk to you. We appreciate it very much.

It was a pleasure.