Nobody knew what to expect. Las Vegas is an entity unto itself, and whether or not its myriad distractions would interfere with the conference’s important business remained to be seen. Many companies decided not to have parties because it’s hard to compete with the constant party that is Vegas. Marc Lawrence of Fairfield Industries, head of the exhibitor’s committee, predicted that the ice breaker would be packed and the Monday-through-Wednesday exhibit floor would be a ghost town.

He was happy to admit how wrong he was. Every time I was on the show floor it was swarming with people. Exhibitors were talking to clients in their booths, and their booth presentations were well attended. The technical sessions were equally packed, and the session I attended, the tribute to Rodney Calvert, was standing-room-only.

That’s not to say that they’re partying like there’s no tomorrow. Every time we asked the question, “How’s business?” we got an answer like “weird” or “I’m not sure.” Most of the seismic contractors have been through this before, of course. When there’s less demand for new data, they work on reprocessing old data. They anticipate that clients will shift their attention to new areas as resources like oil shale are no longer economic, and they try to be ready when that shift comes.

But there seemed to be a general sense that demand is unlikely to drop enough to keep prices depressed for long. Next year’s show will be in Houston, not quite the party town that Vegas is. It will be interesting to see if the mood has changed.

“Independent oil and gas producers continue to drive activity levels upward, despite the fact that both crude oil and natural gas wellhead prices were lower in September than in either July or August,” petroleum economist Karr Ingham is quoted as saying (Ingham created the Petro Index in 2003). “Other measures of upstream activity – drilling permits, well completions, the rig count, employment – remained very favorable compared to year-ago levels. However, these indicators should be watched closely in the coming months, especially if prices fall closers to producers’ finding and production costs.”

A composite index based on a comprehensive group of upstream economic indicators, the Petro Index reached 282.3 in September, up from 279.6 in August and nearly 50 points higher than the index in September 2007. Among the indicators was the Baker Hughes rig count, up 13% from a year ago; 63.3% more drilling permits issued by the Texas Railroad Commission; and an 8.7% increase in employment.

I will be curious to see how long this enthusiasm remains strong. It brings to mind a paper airplane that reaches the apex of its trajectory before plummeting back to earth. Are the reserves in the Barnett Shale or the Wilcox trend still economic at US $60/barrel oil? We’ll find out.

Witnesses for the plaintiff in the trial, which began Oct. 29, will testify that Chevron paid and supervised the Nigerian military, which shot, tortured, and killed protestors during the demonstration in 1998. Bowoto and more than 100 members of the local Ilage fishing  communities went to the platform to protest the environmental damage and economic disruption they claimed Chevron’s activities had brought to their homes in the Niger Delta.

The prosecution will attempt to prove that Chevron paid members of the notorious Nigerian military and “kill and go” mobile police and ferried them to the platform in Chevron-leased helicopters, with Chevron personnel supervising the operation.

All of this information comes from EarthRights International, a human rights group that is representing Bowoto in the trial. Not surprisingly, the release on Chevron’s website paints a slightly different picture. Chevron refers to the “peaceful protest” as a “hostage-taking incident” and maintains that its platform workers, working for Chevron Nigeria Limited (CNL), were threatened with violence and feared for their lives.

“More than 100 CNL workers and contractors were held for ransom and threatened with acts of violence,” the company states. “Now the hostage-takers are suing Chevron, claming that CNL should not have reported the matter to Nigerian law enforcement officials and that the Nigerian authorities used excessive force in rescuing the workers.”

A statement from Chevron’s Vice President and General Counsel Charles A. James reads, “… workers should have the right to go to work without being taken hostage, and holding innocent people for ransom should not be rewarded through a lawsuit in the US.”

The report goes on to state that Bowoto and other citizens threatened CNL with violence and sea piracy if the company did not pay them money and give them jobs. Weeks later they seized the platform, an adjacent barge, and a tugboat, holding CNL employees and contractors hostage and demanding money and other considerations. CNL tried to negotiate without success.

While eyewitnesses for the plaintiffs will argue that the situation turned ugly without help from the protestors, Chevron’s eyewitnesses relate that the hostage-takers poured diesel fuel on the barge and threatened to set it on fire. At this point CNL brought in the Nigerian Navy. During the rescue, shots were fired, no doubt leading to Bowoto’s injury and the resulting deaths. However, the Ilage still managed to force seven of the workers to a village, where they were held for three more days before their release was secured.

It will be interesting to learn the results of this trial. Will the courts decide that innocent civilians are being bullied by Big Bad Oil, or will they determine that the more successful a company is, the more likely it is to be sued by opportunists? Watch this space.

Recently Duncan spoke to the Geophysical Society of Houston on “Aggressively passive: Opportunities over an oilfield’s life.” Like a true evangelist, he outlined the case for passive seismic while also maintaining that there is much work to be done.

Passive seismic is what its name implies – geophones are placed in a field “in a pastoral way” without live sources, and they listen to the natural sounds of the earth and the mechanical sounds of a producing reservoir. “We’re trying to imply something about how effective our interaction is with the reservoir,” Duncan said. “We record the noise that normal geophysics would throw away.”

Duncan formed MicroSeismic Inc. in 2003, and at the time his colleagues’ main response was, “What have you been smoking?” Perhaps it’s not surprising. Eleven years earlier an opinion piece by Peter Edwards appeared in The Leading Edge saying the oil industry was “missing the boat” by not paying more attention to passive seismic techniques. The TLE editorial board went so far as to say he was ignoring the commonly known research and that “board members strongly disagree” with his assessments.

With that kind of resounding support, it’s not surprising that passive seismic proponents slunk into their respective corners. But research did continue. While many of the projects were intended to study the correlation between the injection of liquid and the resulting mini-earthquakes that resulted, in 1973 Senturian Science actually received a patent on monitoring hydraulic fracturing operations with seismic. “Thank God for all of us that patent has expired,” Duncan quipped.

Shell and Anadarko also experimented with passive seismic techniques over their fields, and Phillips Petroleum used it to measure subsidence at the Ekofisk field in the North Sea. In 1998 a study was done over the Seventy Six field in Kentucky. In this instance there was no injection; the sensors were used just to listen to the field during normal production operations. After six months it was determined that there were faults in the field that were below the resolution of conventional 3-D seismic, and these faults were controlling the production mechanism of the field.

Most recently the technique has found a use in monitoring fractures in tight reservoirs such as the Barnett Shale in Texas. This is an obvious application since the standard isotropic “bi-wing” pattern that is assumed in fracture modeling is rarely what actually happens downhole. Passive seismic is also useful in steamfloods to determine where the steam is going. And it has great promise for CO2 sequestration.

So while passive seismic is finally being acknowledged as a useful tool in the upstream, Duncan said that challenges remain. These include acquisition challenges such as the need to detect very small signals, noise issues, expense, and site access; processing challenges due to large datasets and needing a real-time solution; and interpretation and analysis challenges based on the need to not only apprehend the data but to comprehend it as well.

Pundits have their benchmarks as to the success of the oil and gas industry, and I have mine. One of the most obvious is the size (we call it “slap factor”) of E&P. When times are good, more folks advertise, and the folio goes up accordingly.

But other benchmarks exist as well. I once wrote a column that attempted to gauge the general health of the industry by tallying the increase in Cadillac sales in Midland, Texas. I’ve lived in oil towns most of my adult life, and the size of the telephone directory is also a pretty good indicator.

The most recent benchmark is the show paper we produce for the Society of Exploration Geophysicists every year. It was not too long ago that we were lucky to have enough ad support for an 8-page daily. Then we ooched up to 12, then 16. The past couple of years they’ve each been 24 pages long.

This year is exciting because it’s not just the ads that have been strong; it’s also the editorial support that we receive from exhibitors. Since we have a small staff and can’t possibly fill 24 pages on our own, we invite folks from industry to contribute articles about their technologies. This year has seen such tremendous support, and the technologies being described are truly ground-breaking. For those of you going to the SEG annual meeting this year, be sure to spend some time on the exhibit floor. It’s going to be a great show.

The institute announced today that it has finalized and signed a contract for a multi-year program with the Research Partnership to Secure Energy for America (RPSEA) to lead a field-based research consortium focused on meeting U.S. natural gas demand and lowering costs for consumers. The consortium is comprised of GTI and 14 participants, including producing companies Atlas Gas & Oil, Aurora Oil and Gas, BreitBurn Energy, CNX Gas Corp., Inflection Energy, NGAS Resources, Noble Energy, and Trendwell Energy Corp.

The principal objective of this project is to develop techniques and methodologies for increasing the success rate and productivity of New Albany shale gas wells to a level at which the otherwise noncommercial wells become commercially viable. The consortium will be conducting joint research targeting the 10.5 Tcf of technically recoverable gas in the New Albany Shale formation, with the overall goal of converting it to an economically recoverable resource.

Noted Guy Lewis, GTI managing director of supply—Exploration & Production, “One key to increasing the supply of natural gas is to develop unconventional supplies, and for these we need new technologies. We’re excited about the opportunity we have to add value to efforts to increase supplies of affordable domestic energy that generates less greenhouse gas than many other sources.”

Funding for this project is provided through the Ultra-Deepwater and Unconventional Natural Gas and Other Petroleum Resources Research and Development Program authorized by the Energy Policy Act (EPAct) of 2005, a program funded by lease bonus and royalties paid by industry to produce oil and gas on federal lands. RPSEA is under contract with the U.S. Department of Energy’s National Energy Technology Laboratory to administer the unconventional natural gas and other petroleum resources exploration and production program element under the EPAct Section 999 Program.

For more information, visit www.gastechnology.org.

But in some ways the worst aspect for the E&P editors was the fact that our building had no power for a week. Now power meant no access to the network, which is where we compile the articles that will be published in the magazine. We were working on our October issue, which should have been shipped to the printer Sept.  17, when we were told to go home early to prepare for the storm. Nobody thought to back all of that stuff up because nobody expected to be without power for so long.

When our office opened Monday, we were missing about half of our staff, who went to Denver for the SPE conference and were responsible for the show dailies. All week we have been trying to figure out where October articles are, what condition they’re in, how much more editing needs to be done, etc. In some cases I’ve read the same article three times (I now know way more about sand control than I ever wanted to). Our goal is to get the magazine to the printer Friday, a week and a half after it was supposed to ship.

One might be tempted under these circumstances to just give up, make October and November a double issue, post the articles on the website, etc. But we have 42,000 readers who look forward (I hope) to reading our publication every month. The editors and our generous contributors have worked hard to make sure the October issue lives up to our usual high standards.

So we’re working like dogs this week. Your October issue will be late. But it will be very, very good.

But this is a tough old city. I’m not from Houston originally but have lived here, on and off, for 13 years. And I’m very proud of my adopted hometown.

I was proud of us in the aftermath of Hurricane Katrina, which dealt New Orleans such a crushing blow. Our city fathers opened the Astrodome and the George R. Brown Convention Center, as well as countless other places, to house Katrina refugees. Our local hotels put them up, in many cases for as long as a year. Local churches and civic organizations did everything they could to make these people feel welcome. It must have worked, because many of them stayed.

Now it’s time to take care of ourselves, and again not only the city fathers but regular Houstonians have risen above the call of duty. I’ve seen images of thousands of utility trucks from all over the continent being staged at the race track, ready to help with the monumental task of clearing out the fallen trees and restoring power. I’ve seen images of extension cords snaking across streets from those on the one side who have power to those on the other side who don’t.

And what I’ve seen first-hand is the general upbeat spirit of this city, whether it’s in a line at a gas pump or a line at one of the few restaurants that managed to open the day after the storm. Everybody is in a good mood despite not having air conditioning or sometimes even ice and water.

Every day a few more businesses reopen, a few more neighborhoods get power. There are no longer lines at the gas stations. Hopefully soon there will no longer be lines at the points of distribution because nobody will need any back-up supplies. We’re not there yet. But I have no doubt that this amazing city will rebound and be stronger than ever. We’re just like that.

This year we will have two major features, one on “industry milestones” and the other on emerging technologies. Here’s the difference between the two: industry milestones are anything that happened in 2008 that may have set some sort of record – largest survey, deepest OBC survey or permanent installation, radical new vessel design, most shots fired in a day, etc. Emerging technologies are concepts that are perhaps in the pilot or beta stage of testing but are not yet commercial.

While I cover these topics as best I can throughout the year, I’m sure I miss things from time to time. So if you have a breakthrough on the verge of transforming the industry, or if you’ve achieved a record that you’re very proud of, please let me know. I’m primarily interested in exploration technology, but if you have drilling or production technology that you’d like to crow about, I can forward that information to one of our other editors.

Please keep me posted on your successes. That’s what I’m here for.

I’ve recently been talking to geophysicists about technologies that will be needed to improve exploration success, and one of the most frequent comments is that there needs to be a better way to combine seismic data with controlled-source electromagnetic (CSEM) data. Seismic, of course, provides a fairly high-resolution image of the structure and stratigraphy of the subsurface but usually can’t detect actual hydrocarbons, while CSEM takes resistivity measurements which can often provide direct hydrocarbon indication but does so on a very low-resolution scale.

A Norwegian company named MultiField Geophysics is pushing this integration from the processing and interpretation level to the acquisition level by developing an ocean-bottom cable (OBC) system that combines seismic with CSEM. The company recently announced results from a field test over the Peon field offshore Norway. The tests involved deploying a series of OBC sensor segments to acquire EM and seismic data. The source, towing a horizontal electric dipole,, was used to transmit various GPS synchronized arbitrary waveforms. Data were acquired and compared with a reference station deployed to monitor the spread, and acoustic data were collected simultaneously on selected acquisition lines.

Preliminary processing shows successful delineation of the gas field, and an analysis of the test data has confirmed the performance of the integrated sensor system. The first full-scale commercial application is scheduled for the first quarter of 2009.

The company was established in November 2006 and is the result of a two-year joint research and development program with its key industry partners, Wavefield Inseis ASA, StatoilHydro Venture ASA, and the Norwegian Geotechnical Institute.

This type of technology could have significant implications for explorationists hoping to take advantage of the joint benefits of seismic and EM. Maybe I’ll ask them to write an article.