(John Kemp is a Reuters market analyst. The views expressed are
By John Kemp
LONDON, July 14 By now everyone knows the shale
revolution was made possible by the combination of horizontal
drilling and hydraulic fracturing.
But although fracking has captured the popular imagination,
and is often used as a synonym for the whole phenomenon,
horizontal drilling was actually the more recent and important
Mastery of horizontal drilling around 1990, originally for
oil rather than gas exploration, was the decisive innovation
that lit the long fuse for the shale revolution that erupted 15
"Horizontal drilling is the real marvel of engineering and
scientific innovation," David Blackmon wrote in Forbes magazine
last year ("Horizontal drilling: a technological marvel
ignored", January 2013).
"While impressive in its own right, the main innovations in
fracking have been beefing up the generating horsepower to
accommodate horizontal wells rather than vertical ones, and
refining of the fluids used to conserve water and create better,
longer lasting fractures in the target formation."
Fracking has captured the imagination because it is
controversial, sounds sinister and like an expletive, makes for
good headlines, according to Blackmon.
But that has obscured the far more important role played by
horizontal drilling in enabling oil and gas to be produced from
previously inaccessible rock formations, revolutionising energy
output and even international relations.
DAWN OF FRACKING
Fracking has been in widespread use for more than 50 years.
U.S. companies began to experiment with using fracturing to
release coal seam gas in the 1940s.
"The basic principle behind underground coal gasification
seeks to find an economically feasible process of burning coal
seams that are so situated that they do not lend themselves to
being mined profitably," the New York Times explained in 1954
("New tests made to gasify coal", Oct. 31, 1954).
"The gases captured from burning the coal seams would
eventually be turned into usable fuels for commercial or
"The test will be performed by hydraulic fracturing," the
paper noted, "in an effort to open up air passages inside the
coal seam" to make it burn more freely and produce a greater
quantity of natural gas.
"Waste petroleum oil bolstered with napalm is pumped into
the well by high-pressure pumps. Sand is mixed with the oil.
Pressure as high as 12,000 pounds per square inch can be built
"The tremendous pressure cracks the formation and the
penetrating liquid oozes into the open channels," the Times
observed. "Kerosene is added to thin the fracturing liquid and
the opening is pumped out. The sand remains to prop open the
In the next few decades, hydraulic fracture treatments, as
well as treatments using concentrated acids to shatter carbonate
formations, were performed on tens of thousands of ordinary oil
and gas wells across the United States and in other parts of the
world (though the use of napalm was eventually phased out).
The initial experiments were conducted by the U.S. Bureau of
Mines, in conjunction with oilfield services firm Halliburton
and others - underscoring the critical role which the
federal government has played in association with private
enterprise in fostering innovation at every stage in the energy
THE TURNING POINT
Horizontal drilling is both newer and older than fracking.
The first horizontal wells were drilled more than 2,000
years ago to produce water on Iran's central plateau and in
Egypt's Western Desert at the time of the pharaohs.
Horizontal wells were noted by the ancient Greek historian
Polybius, who explained how they were used to increase water
production. The history of horizontal drilling was related in
the January 1996 special edition of Schlumberger's "Middle East
Well Evaluation Review: Horizontal Highlights," which is worth
reading in full.
The modern history of horizontal drilling dates back around
100 years. The first patent for a horizontal drilling technique
was issued in 1891. The main application was for dental work but
the applicant noted the same techniques could be used for
The first true horizontal oil well was drilled in Texas in
1929. Another one was drilled in Pennsylvania in 1944.
China tried horizontal drilling in 1957 and the Soviet Union
tried the technique in the 1960s and 1970s, according to the
U.S. Energy Information Administration (EIA) ("Drilling
sideways: a review of horizontal well technology and its
domestic application", April 1993).
But horizontal drilling was expensive, costing up to three
times as much as conventional vertical wells, and therefore
The turning point when horizontal drilling went mainstream
can be dated quite precisely.
"Before 1990, horizontal drilling was not a popular
technique. The oil industry only drilled horizontal wells as a
last resort," Schlumberger explained.
"The global total for 1989 was just over 200 horizontal
wells. In 1990, that total leapt to almost 1,200 wells, with
nearly 1,000 of these drilled in the United States."
The extra cost for drilling horizontally had shrunk to just
17 percent, according to the EIA, as more companies experimented
with the technique and benefited from learning curve effects.
To drill horizontal wells quickly and cost effectively, the
industry had to master the use of flexible drill pipe and
steerable down-hole motors, as well as technology enabling
drillers to monitor changes in the rock in real time so the well
bore can be kept within the target formation.
THE LONG FUSE
Most oil and gas is found in sedimentary basins where the
rock formations underground are layered like a stack of
The most promising formations may only be a few hundred feet
thick, even if they extend for hundreds of square miles in area.
For that reason, vertical wells only come into contact with
the reservoir rock for a few hundred feet. By contrast, a well
drilled through the target formation horizontally can contact
the reservoir for hundreds of metres or even several kilometres.
Originally, horizontal drilling was restricted to formations
which were hard to produce because they had low permeability
(like shale and chalk), or were nearing exhaustion, or where
conventional drilling produced too much water too quickly and
not enough oil and gas.
French oil firm Elf Aquitaine drilled the first
modern horizontal wells in southwest France and in the
Mediterranean off Italy in the early 1980s. BP used horizontal
wells at Prudhoe Bay in Alaska to minimise unwanted water and
gas intrusions into its oil reservoir.
But from 1990, the technique started to proliferate. Most of
the early wells were drilled into the Austin Chalk in Texas at
the Giddings Field and Pearsall Field, as many as 850 in 1990
alone. Most of the rest were drilled into North Dakota's Bakken,
according to the EIA.
By August 1990, horizontal wells were producing 70,000
barrels per day of oil in Texas.
In 1986, Oman's national oil company drilled three
horizontal wells into a problematic reservoir, with
disappointing results. But from 1990, a much more ambitious and
successful programme was begun. By the end of 1994, Petroleum
Development Oman had drilled more than 200 horizontal wells.
In the early 1990s, more than 50 horizontal wells were also
drilled in Abu Dhabi, and Saudi Arabia also embraced the
technique for its depleted Watra oil field in the Neutral Zone
shared with Kuwait, according to Schlumberger.
The tremendous potential of horizontal drilling was
recognised right from the start. "Success led some people to
speculate that by the end of the century 50 percent of all new
wells drilled in the United States would be horizontal,"
Schlumberger wrote in 1996.
That prediction turned out to be premature - but only by a
few years. The number of oil and gas wells being drilled
horizontally overtook the combined number of vertical and
directional (slanted) wells for the first time in March 2010 (link.reuters.com/wan42w).
Two-thirds of oil and gas wells are now drilled
horizontally, according to the weekly rig counts published by
oilfield services company Baker Hughes.
It took roughly a decade of experimentation, between 1993
and 2003, to work out how to combine horizontal drilling and
hydraulic fracturing in the Barnett shale in Texas, an approach
pioneered by George Mitchell at the eponymous Mitchell Energy.
Many of the improvements developed producing gas from the
Barnett were then applied back to oil production from North
Dakota's Bakken and then the Eagle Ford shale in Texas.
From 2003, however, the number of wells drilled horizontally
has grown exponentially. In fact, horizontal wells have largely
replaced vertical and directional wells, on account of their
greater reservoir contact and efficiency.
The shift was foreseen by Schlumberger: "In simple terms,
horizontal wells allow us to do things more efficiently than
vertical wells. It would be short-sighted to ignore a technique
which offers improved drainage in typical reservoirs and more
discrete compartments in complex reservoirs, while helping
reduce gas and water coning."
Commentators often write about the shale revolution as if it
began in Texas in the early years of the 21st century. But no
revolution emerges from nowhere. The fuse for the shale
revolution was lit at least at decade earlier.
The authors of articles about horizontal drilling back in
the late 1980s and mid-1990s would have been surprised it is
seen as a 21st century phenomenon given how much of the
revolution had been anticipated 20 years earlier.
Commentators, particularly those sceptical about fracking,
also draw a sharp distinction between "good" conventional oil
and gas well and "bad" unconventional fracked ones.
But history shows there is no clear division between
conventional and unconventional oil and gas production.
Fracking and horizontal drilling have both been widely
applied in both conventional and unconventional contexts.
Techniques pioneered to extract oil and gas from
conventional but complicated formations have then been applied
back into unconventional contexts, and vice versa.
Finally, the history of fracking and horizontal drilling
demonstrates the long lead times needed to perfect and diffuse
New technologies often go unrecognised, at least by those
outside the field, for years before they burst into mainstream
So the next generation of technologies which will
revolutionise oil and gas production are probably already out
there being practised on a small scale - waiting to be improved
and discovered more widely.
(Editing by David Evans)