Prospects of Commercialization, Surfactant/Polymer Flooding, North Burbank Unit, Osage County, OK

The economics of commercial-scale surfactant/polymer flooding in the North Burbank Unit are marginal under current economic conditions and tax climate. This is probably true of most stripper reservoirs. Escalation of costs and oil prices at equal rates will not make commercial expansion attractive. The crude oil excise tax is a disincentive to expanded surfactant/polymer flooding in stripper reservoirs, but restructuring or repeal of the tax would produce only a small increase in incentive. The economics of expanded surfactant/polymer flooding in the North Burbank Unit are more sensitive to deviation from expected tertiary oil production than to chemical prices. Technological improvements can be expected to increase the oil recovery in the future. The crude oil excise tax tends to favor application of teritary processes as early as possible in the life of a reservoir. Under current conditions some form of front-end incentive is needed before widespread application of surfactant/polymer flooding to stripper reservoirs can become a reality.