| Berry to invest in new wells
Bakersfield-based Berry Petroleum Co. expects to invest
$210 million over the next four years drilling more than
500 wells in the Midway-Sunset, the state's largest producing
oil field.
Berry estimated that the diatomite project, which stems
from a two-year pilot program, will recover 30 million barrels
of oil, increasing production to 7,000 barrels of oil a
day by 2010.
Berry president and CEO Robert Heinemann said in a written
statement that the project represents "a significant
asset for our California operations and for Berry."
"That's going to be a significant increase for them,
tapping a good reservoir," said Randy Adams, district
deputy of the California Division of Oil, Gas and Geothermal
Resources.
"Midway-Sunset remains one of the biggest producing
fields in the country. They are putting a lot of capital
into that, so they must really believe in it." Adams
said diatomite oil is trapped inside rock formations, making
it difficult to extract. He said the oil is removed by creating
fractures in the rock.
High oil profits are enabling companies to put more money
and resources into production of harder-to-get oil.
"We're starting to see a lot of different pilot projects
being proposed and being tried," Adams said. "A
lot of it has to do with the operators getting a good price
of oil out of the ground ... If the price they are getting
for oil (stays high), they are going to go after everything
they can get." Berry, one of the largest independent
oil and gas producers in California, said the pilot program
began with 13 wells in 2004 and has expanded and increased
productivity since.
Adams said diatomite oil extraction is not new, noting
that Kern's South Belridge, North Belridge and Lost Hills
fields have large diatomite resources. Adams said that while
it was known that Midway-Sunset had diatomite resources,
other oil reservoirs in the massive field were easier to
extract.
With current market conditions and oil resources slowly
drying up, Adams said oil companies are taking a harder
look at parts of fields they previously largely ignored.
"They are constantly going after new ways to get oil,"
Adams said.
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