Hydroelectric power presently contributes only 

 four per cent of the total domestic energy con- 

 sumption. Most of the major opportunities for 

 hydroelectric generation have already been uti- 

 lized; it is difficult to conclude that such an energy 

 source could be expanded much beyond the 

 percentage of domestic energy demand which it 

 now serves. 



Nuclear power is predicted by nearly all observ- 

 ers to be a rapidly expanding source of domestic 

 energy, especially for generating plants and partic- 

 ularly if controlled breeder-reactors to utilize 

 U-238 are perfected. Although it will undoubtedly 

 provide a larger share of U.S. energy demands each 

 year, the demand for petroleum and natural gas 

 will continue to increase. The influence of nuclear 

 power on coal consumption may be more signifi- 

 cant than for oil or gas. 



III. PRESENT OPERATING CAPABILITIES 



Offshore oil was actually produced first in 

 about 1894 in California, from wells drilled on 

 wooden wharves or through wells directed seaward 

 from the beach. Petroleum operations in the Gulf 

 of Mexico began in Texas in 1936 and in Louisiana 

 in 1938. However, these were obvious extensions of 

 known resources beneath the shoreline, and in 

 each of these seaward steps one foot was carefully 

 kept on land. 



The first geophysical exploration beyond sight 

 of land was conducted in the Gulf of Mexico in 

 October 1944, and the first well drilled beyond 

 sight of land was spudded in August 1946. 

 Unfortunately, this well was dry, but nevertheless 

 these were the first truly major steps into the 

 ocean. The first offshore discovery well was 

 completed off Louisiana in 1947, and the first 

 offshore pipeline was completed in October 1951. 

 The first ocean-bottom well completion was off 

 Peru in September 1960. 



Expansion seaward has been rapid since these 

 first small steps. Great improvements have been 

 made in marine geophysical tools and techniques. 

 A whole new generation of vessels has been 

 designed and built to drill in increasingly deeper 

 waters. In the last 10 years, petroleum production 

 has moved from 70 feet of water to more than 300 

 feet. The first well to be completed entirely under 

 water was installed in Lake Erie in 1959, and now 



there are probably more than 50 such completions 

 in waters that exceed 250 feet deep. 



The first field to be produced from a man-made 

 island was in Cahfornia in 1953-1956, and several 

 other islands have now been added to this coast. 

 Pipelines have now successfully been laid in more 

 than 300 feet of water, and production has been 

 estabUshed at least 70 miles from shore. 



In the last 10 years, the maximum water depth 

 in which production wells could be drilled has 

 progressed from about 100 feet to more than 600 

 feet. These depths include most of the world's 

 continental shelves; however, exploration has not 

 stopped there. Leases have been granted by the 

 Department of the Interior for petroleum explora- 

 tion and production more than 100 miles off the 

 U.S. shores, and in waters up to 1,800 feet deep. 

 About 100 core holes have already been drilled 

 beyond the U.S. continental shelves, some in 

 waters nearly 5,000 feet deep. 



The search for petroleum beneath the oceans is 

 not only pushing steadily toward deeper waters, 

 but it is already a firmly estabUshed international 

 effort. Production has been established off nearly 

 22 nations and exploration is underway off the 

 shores of more than 75 countries on five conti- 

 nents. Drilling rigs are now at work on the 

 continental shelves of 35 countries and 15 more 

 are expected soon. 



This expansion over the last two decades has 

 indeed been spectacular, but it has required a great 

 deal of engineering and scientific ingenuity as well 

 as vast amounts of risk capital. 



Even though this growth has been rapid it has 

 been an evolutionary (rather than a revolutionary) 

 expansion, where each new step was soundly based 

 on the experience and knowledge gained from the 

 preceding steps. This pattern can be expected to 

 continue as production capabilities step into the 

 deeper and more remote waters of the world. 



A. Exploration Capabilities 



Geophysical exploration is probably the only 

 aspect of marine petroleum development which is 

 faster and cheaper offshore than it is on land. This 

 is due to the fact that there are fewer barriers at 

 sea to rapid and direct transportation, and that 

 geophysical techniques have been developed which 

 allow a ship to collect data while underway; hence, 

 the cost per mile of survey is less than on land. 



VII-203 



