Back to Oil!
by Alexandre Lavelle, Elias Ghantous, Yousef Al-Jarrah
July 2018
NOCs & the Indies’ agrarian art of production

Back to Oil ! is an elegy devoted to the oilman’s works and days on the ground, in a world where digitalization makes reality abstract. Excellence comes from the simplicity of concrete gestures and the agrarian rites of oil production. The perpetuity of the National Oil Companies facing maturity depends on the art of cultivating their fields. The American Independent Producers’ operating model, at the historic origin of the Oil & Gas industry, can be in this context a source of inspiration.

“Ladies and gentlemen, I do my own drillin’, and the fellers that work for me are fellers I know. I make it my business to be there and see to their work; I don’t lose my tools in the hole, and spend months a-fishin’; I don’t botch the cementin’ off, and let water not the hole, and ruin the whole lease. And let me tell, I’m fixed right now like no other man or company in this field. Because my Lobos River well has jist come in, I got a string of tools all ready to put to work. I can load a rig onto trucks, and have them here in a week. I’ve got business connections, so I can get the lumber for the derrick – such things go by friendship, in a rush like this. That’s why I can guarantee to start drillin’, and put up the cash to back my word. I assure you whatever the others promise to do, when it comes to the showdown, they won’t be there.” Oil! Upton SINCLAIR, 1926

Hydrocarbon nationalisation in the second half of the twentieth century merged private operators to create a State-owned monopoly in charge of domestic Oil & Gas production. Hydrocarbon nationalisation gave the State control of giant petroleum fields marking the rise of National Oil Companies. Hydrocarbon nationalisation happened at the eruptive stage of reservoir developments.

However, after fifty years of operations, most of these reservoirs are today in decline; National Oil Companies are looking for a new model to manage the maturity of their assets and the renewal of their resources. Reservoir management has become more complex; water injection floods field areas, with increasing water-cut and gas volumes indicating rapidly advancing field maturity. Generally, these issues require an upgrading of treatment facilities. The major, founding fields have matured as National Oil Companies age, usually resisting their inevitable production decline through secondary and tertiary recovery programs.