EniraneenioliRecovern Tetional Peon GoneNATIONAL PETROLEUM COUNCIL 1625 K Street, N.W., Washington, D.C. 20006 (202) 393-6100 June 21, 1984 ‘The Honorable Donald Paul Hodel Secretary of Energy Washington, D.C. 20585 My dear Mr. Secretary: On behalf of the members of the National Petroleum Council, I am pleased to transmit to you the report Enhanced Oil Recovery, as approved by the Council at its meeting on June 21, 1984. This report was prepared in response to a March 10, 1982 request from the Secretary of Energy. It is gratifying to advise you that we have reached the broad conclusion that enhanced oil recovery (EOR) from known reservoirs in the United States could contribute significantly to the nation's future domestic crude oil supply. However, this potential is highly dependent on a broad spectrum of economic, technological, and policy considerations and constraints, which will require the concerted attention of both industry and government in order for the nation to realize the benefits of this resource. Conventional primary and secondary recovery methods will produce only about one-third of the oil discovered in the United States to date. Of the remaining two-thirds, a portion is producible through EOR technology. The report concludes that as much as 14.5 billion barrels of additional oil could ultimately be recovered with the successful application of existing EOR technology, under current economic conditions. The rate at which this additional resource could be produced is equally significant, potentially exceeding | million barrels per day by the early 1990s and sustaining this rate for nearly twenty years. The Council believes that this report presents the most realistic estimate made to date on the timing of enhanced oil Production. Technology and economics will both have a major impact on enhanced recov- ery potential. Technical uncertainties still exist with regard to the various EOR processes examined in the report; the level of technical maturity varies among the processes. The report demonstrates the significant impact that technological advances can have on the recovery potential. However, only through continued process research and field testing, with both industry and government support, can the large volume of hydrocarbons discussed in the report be produced. Addi- tionally, the high costs and risks associated with EOR development present poten- tial economic constraints that must be met with reasonable and consistent economic and regulatory policies. An Advisory Committee to the Secretary of Energy‘The Honorable Donald Paul Hodel Page Two While the report demonstrates the significant potential recovery from EOR methods, this potential represents only a fraction of the production that will be required to meet the nation's future demand for liquid petroleum. If successfully applied, EOR methods can constitute an important contribution to the future domes- tic petroleum supply and must be vigorously pursued by both industry and govern- ment. However, the potential recovery from EOR methods will not by itself be a solution to the nation's long-term energy needs. It must be emphasized that this potential should be considered as but one component of the supply mix neces- sary to meet these needs. All other sources must also be considered. ‘The National Petroleum Council is pleased to be able to serve you and our nation. We sincerely hope that this study benefits you and the government in your efforts to facilitate the expansion of the U.S. liquid fucls supply through the develop- ment of all potential resources. ectfully submitted, DQ AbD Robert A. Mosbacher Chairman RAM/pkd Enclosure