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Published: Friday, 8/15/2008

High oil prices stoke interest in extracting Toledo area deposits

BY LARRY P. VELLEQUETTE
BLADE BUSINESS WRITER

You might not know it looking across the topographically-challenged lakeside landscape, but there's probably oil under Oregon.

Bowling Green, too. And Cygnet, and Lima, and a whole crescent-shaped swath of northwest Ohio. There's also some under southern Michigan.

While politicians in Washington discuss and debate the merits and perils of drilling for oil along America's coastlines, billions of barrels' worth is believed to lie in subterranean pockets across the continental United States.

Maybe as much as 4.5 billion barrels may be beneath northwest Ohio, according to state geologists.

There's just one problem: How to draw it out of the ground?

"I know there's a lot of oil still left up there in northwest Ohio, it's just a matter of figuring how to get it out and trying to do it economically," said Ron Riley, senior geologist with the Ohio Geological Survey.

"There's so much unknown about what's not there and what's poorly documented, it makes it difficult to go in and try to find what works."

For nearly 20 years in the last part of the 1800s, northwest Ohio's skyline was dominated by oil derricks drawing up high-quality crude from the Lima-Indiana tract.

Geologists and historians believe that more than 100,000 wells were drilled in a huge arc from Bowling Green, through Lima, and west to the Indiana line, extracting an estimated 250 to 400 million barrels of oil.

The boom - which created the precursor of Marathon Oil and drew thousands to Bowling Green and Findlay - went bust just after 1900 when huge oil deposits were discovered in Texas and the price of crude fell to just 3 cents a barrel.

Mr. Riley and other state geologists said the early oil boomers probably extracted only about 10 percent of what the deposit holds 1,400 feet below the surface.

But they punctured the ground in so many places that it's nearly impossible for modern-day oil extraction efforts to develop enough pressure to force oil to the surface.

Still, historical challenges are looking less daunting in the face of $115-a-barrel oil.

The federal government estimates that the continental United States other than Alaska has approximately 39 billion barrels of discovered crude-oil deposits that are "technically recoverable," and an additional 18 billion barrels of deposits yet to be discovered. Oil-rich Alaska is believed to hold more than 26 billion barrels of recoverable oil.

For decades, however, prospectors and geologists had few clues to go on in their hunt for oil. That changed with the advent of computer modeling and advanced underground surveying.

According to the U.S. Energy Information Administration, the number of domestic crude-oil wells drilled last year - 14,477 - reached the highest number since 1987.

Although the success rate for exploratory wells ranged historically between 57 and 70 percent during the last half of the 20th century, new technology has pushed that number closer to 90 percent.

As Ohio experiences increased drilling along the Appalachian ridge on the east side of the state, oil companies have begun reopening areas of southern Michigan looking for oil.

"We're about 100 permits behind last year, and this is only August," said Rex Tefertiller, permit coordinator and geologist with the permit and bonding unit of the Michigan Department of Environmental Quality, Office of Geological Survey.

"This year, we're seeing an increase in companies looking for oil in old fields, old wells, because what wasn't economical 20 years ago now starts looking economical with today's oil prices," he said.

Much of the activity is focused on the Albion-Scipio oil field, which extends from south of Lansing to northern Hillsdale County, Mr. Tefertiller said. Several companies have drilled new wells into the formation recently and have stuck oil.

"It's the state's biggest oilfield," said Mike Bricker, supervisor of the petroleum geology production unit.

Contact Larry P. Vellequette at:

lvellequette@theblade.com

or 419-724-6091.



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