Financial Petroleum Holdings
EXECUTIVE SUMMARY
The prospects that have been evaluated all represent either un-tapped proven reserves or re-entry or rejuvenation projects of formerly producing wells in the South Eastern United States. As technology US Petroleum Holdings has continued to improve, old wells and old fields that were once too dangerous, too unproductive or “empty” can be reopened and produce economically. These wells are preferred because they are already along the gas and oil pipeline routes that crisscross the United States (i.e. infrastructure costs to monetize new finds in these old wells are minimal).
These investments represent late-stage investment which mitigates the riskUS Petroleum Holdings to investors and the time to production on these wells is shorter than if investments were made in the early stages.
Bissonet Humble Petroleum
Bissonet Lease at Humble Salt Dome Field
History
Humble Salt Dome Field was discovered in the early 1900’s. Bubbles of oil were first observed seeping from the ground near the San Jacinto river in 1887. Humble became an oil boomtown in the early 1900’s when oil was first produced here. The first oil was produced a couple years earlier after the famous Spindletop discovery in Beaumont Texas.
In the fall of 1902, George Hart spudded a well in the field on evidence of escaping gas in the area. His operation was halted by a blowout, an unexpected volume of gas under pressure, that forced the drilling equipment out of the hole. Blowouts were encountered in several wells in the part of the field later called “the hill” and drilled in the summer of 1904 by C.E. Barrett of Houston. Despite the menace of blowouts, some success was found in the early field when Higgins Oil and Fuel Company brought in a large-volume gas well half a mile Southeast of Barrett wells in October 1904. By the end of the year, Humble field reported two sporadically-producing oil wells that had yielded 2,000 barrels of oil. Since none of the crude had been sold, it was stored in earthen tanks for use in the field. Even though blowouts hampered field development, their threat was minimized by the invention of a blowout preventer in 1905. D.R. Beatty used the blowout preventer on the #2 Fee Well which gave up the first gusher with a potential of 8,500 barrels of oil a day from a depth of 1,012 feet.
From 1905 through 1913, development of the field concentrated on the caprock of the salt dome, producing at depths of 1,100 – 1,200 ft. When deep production was found on the dome flanks at Sour Lake Field, operators in Humble field drilled into zones below 2,500 ft., hoping to emulate the success at Sour Lake. In November 1913 the effort was rewarded when Producers Oil #11 Carroll cam in with a potential 10,000 barrels of oil per day at a total depth of 2,700 ft. Forty-six wells were completed before the end of the year, and production reached nearly 2.8 million barrels of oil. In 1935 the Wilson Oil House Well #1 came in at 1500 bopd from the 2,500 ft. sand on the north flank of the field.
Geological estimation of total reserves: 50,000,000 barrels of oil.
Estimated Payout: somewhere between 100 – 300 barrels of crude oil per day.
Financial Petroleum Holdings
EXECUTIVE SUMMARY
The prospects that have been evaluated all represent either un-tapped proven reserves or re-entry or rejuvenation projects of formerly producing wells in the South Eastern United States. As technology has continued to improve, old wells and old fields that were once too dangerous, too unproductive or “empty” can be reopened and produce economically. These wells are preferred because they are already along the gas and oil pipeline routes that crisscross the United States (i.e. infrastructure costs to monetize new finds in these old wells are minimal).
These investments represent late-stage investment which mitigates the risk to investors and the time to production on these wells is shorter than if investments were made in the early stages.
Bissonet Humble Petroleum
Bissonet Lease at Humble Salt Dome Field
History
Humble Salt Dome Field was discovered in the early 1900’s. Bubbles of oil were first observed seeping from the ground near the San Jacinto river in 1887. Humble became an oil boomtown in the early 1900’s when oil was first produced here. The first oil was produced a couple years earlier after the famous Spindletop discovery in Beaumont Texas.
In the fall of 1902, George Hart spudded a well in the field on evidence of escaping gas in the area. His operation was halted by a blowout, an unexpected volume of gas under pressure, that forced the drilling equipment out of the hole. Blowouts were encountered in several wells in the part of the field later called “the hill” and drilled in the summer of 1904 by C.E. Barrett of Houston. Despite the menace of blowouts, some success was found in the early field when Higgins Oil and Fuel Company brought in a large-volume gas well half a mile Southeast of Barrett wells in October 1904. By the end of the year, Humble field reported two sporadically-producing oil wells that had yielded 2,000 barrels of oil. Since none of the crude had been sold, it was stored in earthen tanks for use in the field. Even though blowouts hampered field development, their threat was minimized by the invention of a blowout preventer in 1905. D.R. Beatty used the blowout preventer on the #2 Fee Well which gave up the first gusher with a potential of 8,500 barrels of oil a day from a depth of 1,012 feet.
From 1905 through 1913, development of the field concentrated on the caprock of the salt dome, producing at depths of 1,100 – 1,200 ft. When deep production was found on the dome flanks at Sour Lake Field, operators in Humble field drilled into zones below 2,500 ft., hoping to emulate the success at Sour Lake. In November 1913 the effort was rewarded when Producers Oil #11 Carroll cam in with a potential 10,000 barrels of oil per day at a total depth of 2,700 ft. Forty-six wells were completed before the end of the year, and production reached nearly 2.8 million barrels of oil. In 1935 the Wilson Oil House Well #1 came in at 1500 bopd from the 2,500 ft. sand on the north flank of the field.
Geological estimation of total reserves: 50,000,000 barrels of oil.
Estimated Payout: somewhere between 100 – 300 barrels of crude oil per day.
Recent Outlook Industry of Petroleum
Energy Information Administration
Official Energy Statistics from the U.S. Government
Trends in energy supply and demand are affected by many factors that are difficult to predict, such as energy prices, U.S. economic growth, advances in technologies, changes in weather patterns, and future public policy decisions. It is clear, however, that energy markets are changing gradually in response to such readily observable factors as the higher energy prices that have been experienced since 2000, the greater influence of developing countries on worldwide energy requirements, recently enacted legislation and regulations in the United States, and changing public perceptions of issues related to the use of alternative fuels, emissions of air pollutants and greenhouse gases, and the acceptability of various energy technologies, among others The Energy Information Administration projects increased consumption of biofuels (both ethanol and biodiesel), growth in coal-to-liquids (CTL) capacity and production, growing demand for unconventional transportation technologies (such as flex-fuel, hybrid, and diesel vehicles), growth in nuclear power capacity and generation, and accelerated improvements in energy efficiency throughout the economy.
Despite the rapid growth projected for biofuels and other nonhydroelectric renewable energy sources and the expectation that orders will be placed for new nuclear power plants for the first time in more than 25 years, oil, coal, and natural gas still are projected to provide roughly the same 86-percent share of the total U.S. primary energy supply in 2030 that they did in 2005 (assuming no changes in existing laws and regulations). The expected rapid growth in the use of biofuels and other nonhydropower renewable energy sources begins from a very low current share oftotal energy use; hydroelectric power production, which accounts for the bulk of current renewable electricity supply, is nearly stagnant; and the share of total electricity supplied from nuclear power falls despite the projected new plant builds, which more than offset retirements, because the overall market for electricity continues to expand rapidly in the projection.
