Crude Formation And Production – How is It Made?

How Is Crude Oil Formed?

It is generally believed that crude oil was formed from the remains of animals and plants (called biomass) that lived many years ago. Over eons, the biomass was covered by layers of mud, silt, and sand that formed into sedimentary rock.

Crude Formation

Geologic heat and the pressure of the overlying rock turned the biomass into a hydrocarbon-rich liquid that we call crude oil, and eventually forced it into porous rock strata called reservoirs. There are also formations or deposits of hydrocarbon-saturated sands and shale where geologic conditions have not been sufficient to turn the hydrocarbons into liquid.

How Is Crude Oil Produced?

Wells are drilled into oil reservoirs to extract the crude oil. “Natural lift” production methods that rely on the natural reservoir pressure to force the oil to the surface are usually sufficient for a while after reservoirs are first tapped. In some reservoirs, such as in the Middle East, the natural pressure is sufficient over a long time. The natural pressure in many reservoirs, however, eventually dissipates.

Then the oil must be pumped out using an “artificial lift” created by mechanical pumps powered by gas or electricity.  Over time, these “primary” methods become less effective and “secondary” production methods may be used. A common secondary method is “waterflood” or injection of water into the reservoir to increase pressure and force the oil to the drilled shaft or “wellbore.” Eventually “tertiary” or “enhanced” oil recovery methods may be used to increase the oil’s flow characteristics by injecting steam, carbon dioxide and other gases or chemicals into the reservoir.

Crude production graphic

In the United States, primary production methods account for less than 40% of the oil produced on a daily basis, secondary methods account for about half, and tertiary recovery the remaining 10%. Extracting oil (or “bitumen”) from oil/tar sand and oil shale deposits requires mining the sand or shale and heating it in a vessel or retort, or using “in-situ” methods of injecting heated liquids into the deposit and then pumping out the oil-saturated liquid.